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Telecom Mergers, Acquisitions on Pace for Record Level

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Telecom Mergers, Acquisitions on Pace for Record Level

 
May 29, 2015

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  By Rory J. Thompson, Web Editor
 


In a sign that things are good and probably only going to get better, technology and telecom firms are putting on some muscle, according to The Wall Street Journal. In a story out May 29, it was reported that tech and telecom buyouts hits $406 billion so far in 2015, matching a pace last set in 2000.


“Behind the billions of dollars are trillions of megabytes of data that are set to be transferred every year on everything from mobile phones and TVs to industrial applications like connected factories and videoconferencing in coming years,” the Journal said.

Among the deals making news, according to the paper:

U.S. data-center operator Equinix (News - Alert) Inc. joined the when it won a bidding war to acquire U.K.-based competitor Telecity Group PLC in a deal worth $3.6 billion, amid skyrocketing demand for storage and computing power.

Chipmaker Avago Technologies Ltd. agreed this week to buy rival Broadcom (News - Alert) Corp for $37 billion, the largest pure technology deal on record, and the latest in a wave of consolidation among chipmakers that power a new generation of connected devices.

Last month Nokia (News - Alert) Corp  agreed to acquire France’s Alcatel-Lucent in an all-stock deal valued at the time at $16.6 billion, in a bid to build scale, to compete to build a new generation of high-capacity wireless and wired data networks.

“The digital economy—whether it’s cloud computing, mobile data, Big Data, the Internet of Things –all of those things are driving growth globally,”  Eric Schwartz, Equinix’s President of Europe, the Middle East and Africa, was quoted by the Journal as saying.

All the acquisitions and buyouts make perfect sense, if industry forecasts are to be believed. It’s reported that Internet data traffic will nearly triple between 2014 and 2019 to nearly 168 petabytes —or billion megabytes — per month, according to new estimates from Cisco (News - Alert). By then, over half of all Internet traffic will originate from devices that are other than traditional desktops—such as TVs and tablets, the Journal said, putting telecom giants in an enviable position.




Edited by Stefania Viscusi
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