Ericsson expands in wireless enterprise with Vonage acquisition

Swedish telecoms giant Ericsson has agreed a deal to acquire cloud-based communications specialist Vonage for $6.2bn (£4.63bn).

The cloud-based Vonage Communications Platform (VCP) serves more than one million registered developers globally via its API (Application Programming Interface) platform. US-based Vonage’s API helps different forms of digital software communicate with each other.

The deal, one of the largest in Ericsson's history, follows the company’s recent $1.1bn acquisition of Cradlepoint, which gave it access to tools that can connect devices using the so-called Internet of Things over a 4G or 5G network.

On completion of the all-cash transaction, Vonage will become a wholly owned subsidiary of Ericsson and will continue to operate under its existing name.

The deal marks the latest move by Ericsson into wireless enterprise where it has stated plans to “expand globally” by 2030. The new subsidiary company will especially focus on the Communication Platform as a Service (CPaaS) segment and look to accelerate enterprise digitalisation and develop advanced APIs made possible by 5G including telemedicine, immersive virtual education and autonomous vehicles.

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