Friday, October 5, 2007

Dialogic Acquires Cantata

I got a press release this morning announcing that Dialogic has acquired EAS Group, which in turn owns Cantata. That was news to me, and I haven't seen any commentary out there about this yet. Either people are busy with other things, or it's a non-event. Not sure.

Anyhow, you can read the release for yourself on Dialogic's website, or if you go to Cantata's site, there's a message directing you over to Dialogic's site, or a click-through to the same press release that's running on Dialogic's site. So, I guess it's official.

To be fair, I haven't followed Cantata as closely as I used to, but it's no secret they've had difficulty making their mashup of VoIP infrastructure companies work. Cantata is made up of three Massachusetts-based vendors - SnowShore, Excel Switching and Brooktrout. They've all had up and down rides, and at this point, it's clear that a better plan is needed. Consolidation has been a major trend this year in IP, and Dialogic's move is another step in that direction.

I can't really add much else right and will have to look into this a bit further. At first look, there are some parallels to what Radisys did by acquiring Convedia last year. Media servers are a common aspect to both moves, and this is an important nextgen building block, not just for everyday VoIP, but IMS as well.

Clearly Dialogic thinks there's a fit here, and maybe they're trying to become a consolidator now. That said, no financial details of the deal were provided, and it's not explained how Dialogic is funding the deal. The fact that not much is being said about this raises some questions, so it's hard to draw firm conclusions right now.

Of course, if you didn't know, Dialogic is based in Montreal, so it's worth noting that a Canadian company has come into the milieu and acquired an American company. Hate to say it, but it's probably a good time to be doing this given that the Canadian dollar is trading above the greenback. So, for a change, the economics are attractive for Canadian companies to do this.

Actually, with the US dollar being weak relative to other currencies, I wouldn't be surprised to see vendors from other parts of the world follow Dialogic to take advantage of their stronger currency. Time will tell. Meanwhile, it's Canadian Thanksgiving on Monday, so I'm sure the Dialogic execs will be enjoying their turkey. Gobble gobble.

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