Sep 17, 2004 12:00 PM,

Alcatel to acquire Spatial Wireless

By Tim McElligott

Alcatel looked down the road in more ways than one this week when it agreed to acquire Richardson, Texas-based Spatial Wireless for approximately $250 million in American Depository Shares.

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Spatial Wireless, a provider of software-based mobile switching systems, which is near Alcatel’s North American headquarters in Plano, Texas, will be the cornerstone of Alcatel’s mobile solutions division.

"It’s going to be the unique solution in terms of [next-generation networking] product for Alcatel," said Nathalie Smirnov, chief operating officer, mobile solutions division of Alcatel.

With the acquisition, Alcatel will get a commercially available and deployed mobile switching solution designed for IP Multimedia Subsystems (IMS.) The Spatial Wireless Atrium is a multi-standard softswitch that controls distributed media gateways and manages call control and session control for voice and data services.

The product has more than one million ports deployed through installations and field trials with GSM and CDMA operators globally. Atrium has the same technology focus as Alcatel in its use of Carrier-Grade UNIX and Linux operating systems and Advanced Telecom Computing Architecture (ATCA) specifications.

The acquisition is the final step in a relationship that began as a teaming agreement in late 2002 and later became an OEM agreement in March of this year. Spatial Wireless’ 225 employees, mostly in the U.S. with some in India, will come to Alcatel at closing, which is expected next quarter.

"We are definitely enamored of this team we are in the process of acquiring," said David Owen, vice president of Alcatel’s mobile communications group.

Alcatel hopes to take advantage of what it believes is an 18-month competitive advantage in getting out in front of the mobile software switching market. "Spatial’s technology was much further down the road than the other potential suppliers of this technology and even further down the road than we were with our own internal development [on the wireless side.]