Canada’s Redknee surprised a lot of people last week with news that it has agreed to buy Nokia Siemens Networks’ BSS unit for $52 million. The assets had been on the block for months, but with $56 million in annual revenue and a market capitalization of about twice that, Redknee Inc. (TSN: RKN) is smaller than most of the usual suspects thought to be interested.
“We were the smallest party with biggest passion and ambition,” says Redknee CEO Lucas Skoczkowski. “I need the employees to create a bigger business.” About 1,200 NSN employees are moving to Redknee, and Skoczkowski says that those based in Europe will not need to leave as Redknee already has a European operation.
“Redknee certainly isn’t what I expected in terms of a buyer,” says Shira Levine, who follows service enablement and subscriber intelligence for Infonetics Research.. “They definitely have their work cut out for them over the next few months!”
Skoczkowski says he and his company are up to the challenge. He says that even before NSN decided to sell the business, Redknee had been trying to forge a partnership with NSN because he saw ways the two companies could work together. Redknee’s deep expertise in cloud-based real-time converged charging helped the company acquire the business, he says, and will help Redknee integrate NSN’s people, contracts, relationships and patents with its own. Skoczkowski says Redknee combines telecom and IT experience with a strong focus on customer service, and that the combined company will be able to move quickly to help operators find new ways to serve subscribers. “We are bringing some on-premise capability for North American operators and we can bring the scale of high capacity real-time rating and charging, and bring additional flexibility from the cloud,” he says, adding that working with Microsoft has helped Redknee develop its cloud capabilities.
The sky is apparently the limit for Skoczkowski, who named his company Redknee after a Mexican tarantula that it is agile and thrives in changing environments. Skoczkowski says he hopes to make more acquisitions, and to expand Redknee’s real-time charging business to address new vertical markets. “Insurance, financial services, medical, utiliites, water and sewage – all will require some form of pay-as-you-go or pay based on your profile when you use them,” he says.
Despite his passion for real-time charging, Skoczkowski does not subscribe to the belief that billing is going to disappear from the telecom industry. “Our system is all real-time charge with an invoice at the end of the period,” he says. “To me the billing is more a static world, rather than the dynameic world I think we’re going to see. The idea of a flat packet where you will get a one-time invoice – I think people hopefully have buried that. Real-time can accomodate different business models more easily. … It’s not just charging, but analytics that is important on a real-time basis.”
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