In 2023, neutral host provider Boldyn announced the acquisition of private cellular network provider Edzcom from its parent company Cellnex. This ABI Insight discusses the announcement, underlines key implications for the private cellular market, and offers recommendations for how telco industry should react to this trend.
Registered users can unlock up to five pieces of premium content each month.
Log in or register to unlock this Insight.
Neutral Host Provider Boldyn Acquires Private Network Operator Edzcom
Earlier in November 2023, neutral host provider Boldyn (previously BAI Communications) announced the acquisition of Edzcom, Cellnex’s Finnish subsidiary that specializes in connectivity solutions for private networks in industrial complexes and enterprise environments. Edzcom, previously Ukkoverkot, is one of the first companies to deploy private cellular in challenging environments, including mines and offshore drilling platforms. As the largest independent provider of private networks solutions, Edzcom brings experience from 50+ implementations in Finland, France, Germany, Spain, Sweden, and the United Kingdom for world-class enterprises.
For Boldyn, Edzcom is the continuation of a range of recent acquisitions. Since 2021, then called BAI Communications acquired Mobilitie, Signal Point Systems, and ZenFi Networks in the United States. Subsequently, Boldyn was founded in July 2023 to unite all of these different brands. Similarly, for Edzcom, this acquisition is the second in a relatively short time frame. The Spain-based tower and infrastructure company, Cellnex, acquired the Finnish company only in July 2020. Cellnex’s decision to sell its private networks business is primarily motivated by high liabilities in the financial market and struggles with suddenly spiked interest rates. However, it also illustrates key lessons that the telco industry needs to bear in mind when targeting enterprise private cellular networks.
Neutral Host Providers and Private Networks Move Closer Together
Cellnex’s decision to let go of Edzcom is interesting, as it shows two things. First, private cellular networks are long-term prospects and monetizing the efforts will take several years to materialize. Second, tower companies might not be best positioned to move into the private cellular network provider landscape. Their key interest lies in building up renting out tower infrastructure, while enterprise private networks require a lot more managed services on top of the infrastructure.
We need to analyze Boldyn’s announcement from at least two different perspectives. This is yet another sign that neutral host providers are actively looking at private cellular and are currently determining their strategies on how to serve this market. There is the perspective of the different individual parties involved:
- For Boldyn: This is an opportunity to expand further into the private cellular domain. Edzcom brings a healthy channel to industrial enterprise verticals, in particular, and understands their pain points, while having adopted the language spoken within those verticals.
- For Edzcom: This is a second opportunity to emerge and grow its business further. To an extent, the European presence of Cellnex helped Edzcom scale its business to other European countries. However, alignment in terms of cellular connectivity has not created the desired commercial traction. The reasoning for this lies in the fact that enterprises do not care about cellular connectivity technology, but rather about use cases and managed enterprise services. This is why becoming part of a larger service provider organization could be a better fit.
What Does This Acquisition Tell the Telco Industry?
In a way, Boldyn’s acquisition of Edzcom tells the entire story of the private networks market. Most importantly, it shows that market consolidation continues. In addition, it shows that cooperation is the name of the game. No single specialized company will succeed in serving this market alone, no matter how established it is. As ABI Research has discussed in a range of earlier deliverables, enterprises are interested in end-to-end digitalization solutions—including connectivity elements, device management, and enterprise-specific software and application solutions.
The recent histories of Cellnex and Edzcom, however, also illustrate that acquisitions are not an end in itself—and they will not solve all of the telco industry problems when trying to approach enterprise verticals. The telco industry needs to remember to plan acquisitions carefully and combine that with a solid path to align business interests and organizational strategies.
Although the intentions are to keep Edzcom trading under its individual name, this means that Boldyn has important milestones ahead of it to make sure this acquisition carries the lasting fruits that everyone has desired.
- Strategic Planning: Develop a detailed integration strategy that aligns with the overall business objectives of Boldyn. Importantly, this should include a clear definition of what markets/deployments Edzcom will go after and where Boldyn will focus their activities.
- Communication: Communicate the acquisition and integration plan clearly and transparently to both internal and external stakeholders. This is particularly important as Edzcom brings a number of existing enterprise deployments into Boldyn. These need to be informed of any changes impacting the deployment or network management to protect that business opportunity and the reputation of Edzcom as a trusted enterprise partner.
- Technology Integration & Identification of Synergies: After a careful analysis of Edzcom’s service offerings, Boldyn needs to develop a clear idea of how the products of both Boldyn and Edzcom can benefit from each other and how to ensure sufficient product differentiation between the two companies.
- Operational Alignment: Align operational processes, workflows, and service delivery models to achieve consistency and efficiency. Furthermore, this should include standardizing and optimizing operational procedures to streamline business operations.