Metaswitch touts 22% growth

London-based Data Connection Ltd. said today that its Metaswitch division, maker of softswitch and application platforms, reported record fiscal-year 2008 revenue of $92 million or 22% growth over the same period last year.

Overall, Metaswitch now accounts of 78% of Data Connection’s total revenue. Growth at Metaswitch was driven by new deals with large carriers, such as Embarq, as well as continued expansion of its customer base, which now stands at 400 service providers and 250 original equipment manufacturer customers. Metaswitch now serves seven of the top ten US carriers, said John Lazar, Metaswitch president and chief operating officer.

“What we’ve seen over the course of the last year was a continuation of our strengths, including a very diverse customer base and very diverse revenue streams in our core gateway and switching platforms and in MetaSphere, our application suite,” Lazar said.

Metaswitch made a significant strategic move in January 2008, taking on external funding from Francisco Partners and Sequoia Capital to fuel ongoing growth. “While it’s a very uncertain time right now, and it’s not clear where it will end up, we feel there are very big opportunities for well-run companies,” Lazar said, adding that despite limited visibility into the current quarter, Metaswitch is still planning on expanding its headcount next year.

Whether telecom spending will hold in 2009 “is the billion-dollar question,” Lazar said. “My take on where the [telecom] market is right now is that there’s a lot of trepidation and uncertainty. But from what we’re hearing from the field, rather than being entirely negative, it’s much more patchy than that.”

Metaswitch continues its focus on software, leveraging its MetaSphere application platform to develop new apps, such as the recently introduced CommPortal Assistant. Also on the software front was the introduction of the MetaView Network Management System last year, for improved management of its core switching platforms.