Market in transition

On the face of it, it certainly seems like a small-fry, low-price deal. Architel Systems, a service provisioning software vendor, acquired Accugraph, an inventory management vendor. Although the deal is key in creating a larger company that will directly respond to carrier wishes for turnkey service provisioning solutions, it's still small in scale.

However, this seemingly small equity move between software companies may actually be one of the first salvos in a brewing competitive war that may change the way companies sell OSSs to carriers and the very face of the OSS software industry.

Traditionally, this segment has comprised mostly small software developers that focused on one particular OSS niche at which they excelled. They would sell these solutions to carriers as OSS pieces or partner with other vendors to sell carriers a much larger piece-in some cases, even the whole OSS.

As the OSS software market has grown, more niche developers have joined the party. This made the market more confusing for carriers, especially the smaller and newer ones that found it hard to track vendors. To a greater degree, these carriers have been searching for single-vendor turnkey solutions to make it easier for them to build their OSSs.

So now, if the Architel/Accugraph deal is any indication, we may see more smaller niche vendors responding to that demand through mergers and acquisitions. We may also see more larger vendors directing their expertise at developing OSS solutions. Already, Hewlett-Packard is offering its SmartService product as a solution for creating a streamlined service provisioning process.

The odd bit is that vendors will be competing against their one-time niche partners. This was fine when absolutely no one offered a comprehensive product package, but it won't be so fine when a few companies do and others don't. Vendors such as HP will be competing against the smaller applications developers they once supported, and merger partners will team up with one vendor to the exclusion of all others.

It is apparent that many existing partnerships may fall by the wayside, and vendors eventually will have to make difficult but critical decisions about when they will give up on these arrangements.

As that happens, big industry gatherings, such as this week's TeleManagement World in Paris, will become interesting to watch-if not for their standards updates, then at least for all the murmurs, glares and uncomfortable silences.