Verizon is spending US$612 million to buy Hughes Telematics which is expected to give it a boost in the booming automotive M2M market. By Ian Scales.
Hughes Telematics is strong in commercial fleet telematics, infotainment offerings and mHealth and Verizon said it sees the unit fleshing out its ability to offer platform-based M2M solutions to specific verticals.
The industry sees the move as another ramping-up of telco interest in M2M as a key area for growth. According to Yankee Group's Brian Partridge, Verizon is "clearly putting its money where its mouth is, betting on M2M as a new growth engine.
This transaction brings Verizon instant credibility in the automotive telematics and infotainment segments—two of the fastest growing M2M categories Yankee Group tracks. The people Verizon obtains from this transaction are even more valuable than the technology platform because they bring specific vertical expertise that would take Verizon years to develop organically.”
If all goes well the merger will complete in the next (third) quarter. Verizon says it will retain the existing management team and the unit will operate as a subsidiary in Verizon's Enterprise Solutions Group which is headquartered in Atlanta.
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