The consortium that agreed to buy Siemens AG’s machine-to-machine (M2M) wireless business in March has closed the deal and re-branded operations with a new name: Cinterion Wireless Modules.
Neither Siemens nor the new owners, the Joint Operations for Mobile Applications (JOMA), revealed the price of the transaction. Earlier this year, a Siemens spokeswoman said the purchase price would be in the low triple-digit millions of euros.
JOMA’s backers include the venture arm of German mobile phone operator T-Mobile and two private equity firms, Granville Baird and Sapfi Kapitalmanagement.
When it was the wireless modules unit of Siemens’ Automation and Drives division, Cinterion built itself into the lead in the machine-to-machine (M2M) market, with a 34% share, according to research firm Gartner. It has revenues of around €250 million.
"As market leader with an unmatched global approach, Cinterion Wireless Modules is in the pole-position to actively shape the fast-growing M2M market," said Norbert Muhrer, CEO of Cinterion, who was president of wireless modules when it belonged to Siemens. He is one of about 400 employees who have transferred from Siemens to Cinterion, which is headquartered in Munich and has development sites in Berlin and in Wroclaw, Poland.
Muhrer said he expects the company to be more nimble now that it has shaken free of the massive €72.4 billion Siemens industrial conglomerate, which employs around 400,000 people. "Thanks to our new independence, we will now add two more strong points that are of crucial importance for the business: flexibility and speed. And that is on top of our traditional strengths, such as an innovative portfolio, a farsighted road map, and first-class international customer support."
The company bases its technology on the GSM cellular specification and said in a press release that it will develop new products around the 3.5G and 4G iterations of GSM. It also plans enhancements in what it called its “solutions” business, known as M2M One, and will be looking for new vertical and regional markets. Verticals and applications it currently sells into include automotive, e-tolls, metering, point-of-sales, remote maintenance, security and tracking. The company opened as Cinterion on June 1.
In a report released last month, Swedish market research firm Berg Insight forecast a whopping growth in the number of M2M cellular network connections, from 37.5 million connections last year to 186 million in 2012. It predicted that over half of those connections would be in the automotive arena. “Safety and security concerns – manifested either in public regulations or customer preferences – is tipping the balance in favour of massive rollouts of telematics applications by the global automotive industry,” said Berg senior analyst Tobias Ryberg. He noted that telematics systems like GM’s OnStar, which provides push-button access to breakdown and emergency advice, are leading the way.
Research firm ABI Research notes that wireless technologies other than cellular will also play a role in M2M connections, including Wimax and WiFi.