Inseego eyes global opportunity following Nokia M&A deal

• Inseego is acquiring Nokia’s fixed wireless access (FWA) customer premises equipment (CPE) unit
• Its CEO has highlighted a number of major benefits of the deal, including increased scale and an opportunity to capitalise on the ‘6G supercycle’
• Both vendors see the transaction as the beginning of a fruitful relationship

The CEO of Inseego is bullish that its planned acquisition of Nokia’s fixed wireless access (FWA) customer premises equipment (CPE) unit will elevate the San Diego-based supplier into a different league when it comes to serving future wireless broadband needs.

During a call to discuss the all-stock deal, valued at $20m, Juho Sarvikas, who has been in his current post for over a year, described the transaction as “transformational for us” as it will “roughly double the size of the company, give us presence in larger markets around the world, and position us as a global leader in wireless broadband”. As previously reported, this means Inseego expects this acquisition to double the $190m in revenues the company is expecting to generate this year.  

Sarvikas noted that Inseego’s customers are currently located in North America, almost exclusively in the US, where it has already signed up AT&T, T-Mobile US and Verizon as customers for its existing FWA product line.

In future, it will be able to tap into other markets where Nokia already has strong anchor customers. “So for us, what this means is that we go from a US-centric company to a truly diversified global one,” said Sarvikas. 

Just as importantly, he added, “it does that in a category we know very well, and that’s directly aligned with our strategy”.

According to Inseego, it is picking up about 100 customers globally as a result of the deal, including some big names in major FWA markets, including Bharti Airtel in India, Orange in Europe, Rogers Communications in Canada, and NBN in Australia.

A second key advantage of the acquisition is that it “broadens our reach across 5G and future 6G connectivity by adding a strong consumer FWA product line to our already existing enterprise fixed wireless and mobile broadband platform”, he said.  

Sarvikas also hailed what he described as the beginning of a strategic collaboration with Nokia. The Finnish vendor will become a significant shareholder in Inseego (with a planned stake of around 11% once the deal is completed), and the two companies plan to work together on “go-to-market initiatives and innovation at the wireless edge, including AI and 6G”.

Indeed, Sarvikas clearly has high hopes that Inseego will benefit from the increased performance that 6G technology is expected to bring, with a focus on providing higher-speed, lower-latency and more efficient FWA services that offer a “very competitive alternative even to fibre”. 

“We will be in a great position to capture the 6G supercycle at the end of the decade,” he said, noting that both the addressable market and the number of deployments are expected to “scale dramatically”. 

The right fit

Sarvikas was joined on the call by Konstanty Owczarek, chief corporate development officer at Nokia, who said it was important to find the “right owner” – a strategic partner that would further advance Nokia’s FWA CPE business and “support the continuity with our customers”.

“We wanted an owner that understands the category, understands the technology, has the focus and the commitment to continue building on what has already been established,” said Owczarek.

Inseego stood out for several reasons, including its expertise in wireless broadband and the wireless edge. “Second, this business will be central to Inseego – a transformative transaction. We believe the focus combined with Inseego’s capabilities creates a very strong path forward,” he said. 

Owczarek added that the two companies “have a shared view of where the fixed wireless market is going”.

“This will allow us together to collaborate on the joint go-to-market innovation initiatives in 6G and wireless edge and to capture the opportunities in AI that will further advance the FWA business as part of Inseego,” he concluded.

Forecasts for expected growth in the FWA sector vary, but the industry’s crystal ball-gazers are agreed that significant uptake for FWA services (which in turn will drive demand for FWA CPE products) is expected in the next few years – see Global FWA subs heading for 233 million by 2030 – report.

- Anne Morris, Contributing Editor, TelecomTV