What should customers expect after Agilent’s acquisition of AT4 Wireless?

Olga Yashkova, Frost & Sullivan- August 2, 2012

Editor's note: Agilent Technologies acquired the Test Systems business from AT4 Wireless. AT4 continues to operate as an independent company.

Acquisitions continue to be the “status quo” in the communications test and measurement (T&M) industry. Growing business, whether organically or inorganically (or in other words, through an acquisition), has been a strategy for many leading T&M vendors. In the past three to four months, the industry has witnessed five significant acquisitions: Aqilent buying out the test-systems business from AT4 Wireless, Danaher acquiring VSS Monitoring, Ixia purchasing Anue Systems and Breaking Point Systems, and Spirent expanding its product line and coverage through the MuDynamics acquisition.

“[A] M&A isn’t just about capturing market share; it’s also a way to secure new capabilities, products and customers,” according to Holly Lyke-Ho-Gland, Research Lead for the Growth Team Membership at Frost & Sullivan.   “Whether you achieve these objectives depends on how successfully you integrate with an acquired company.”  This is a very accurate statement and I am confident that Agilent’s acquisition of AT4 Wireless will not only be successful, but also beneficial for both companies, as well as for their global customers.   The wireless test equipment product line from AT4 wireless will widen Agilent’s product offerings in the growing LTE testing market. In addition, this acquisition will expand Agilent’s wireless test footprint by adding Bluetooth and NFC/RFID test solutions for R&D and conformance.

About Agilent
Agilent, the world’s leading test equipment vendor, was founded in 1999 as a spinoff of Hewlett-Packard. The company designs and manufactures R&D and manufacturing solutions for telecom and wireless SPs and NEMs. The company is present in more than 100 countries and employs more than 20,000 employees. Agilent was the leading organization in the global wireless test equipment market in 2010, capturing more than 17 percent of overall market revenues, which was the biggest market share. In addition, the company was one of the leading vendors in the LTE test equipment market in 2011. Agilent is expected to continue strengthening its position in the wireless test equipment market in the future.

About AT4 wireless
AT4 wireless is a test equipment vendor specializing in carrier device acceptance, performance, conformance, field, functional and interoperability testing. AT4 wireless is a private company based in Malaga, Spain that employs more than 200 people globally. AT4 wireless has testing laboratories in the USA, Chile and Taiwan.  The company was founded in 1991 and, since then, it has continually increased its presence and global footprint in the wireless test equipment market.
In addition to test equipment, AT4 wireless offers services such as IT consultancy, development and training to many industries such as telecommunications, automotive, health care, consumer electronics and security, primarily based around wireless and cellular technologies.

LTE Test Equipment Market
According to Frost & Sullivan’s most recent research, the global LTE test equipment market generated revenue of $760.8 million in 2011. In 2018, revenue is expected to reach $2.8 billion, at a compound annual growth rate (CAGR) of 20.7 percent.  LTE is expected to create numerous opportunities for wireless test equipment vendors during this forecast period. 





The market is driven by the increasing deployment of LTE and the explosion of wireless data. Some drivers of mobile data traffic growth include the availability of high-speed networks; the increased penetration of smartphones, as well as connected devices such as laptops, netbooks, notebooks, and tablets; and the use of higher bandwidth-consumer applications and services.

According to Facebook, Inc., more than 350 million active users access Facebook through their mobile devices.  In addition, more than 475 mobile operators globally work to deploy and promote Facebook mobile products. This market development, amongst others, reveals a rise in the need for test equipment like never seen before as SPs determine the connection between QoE and customer churn. 

One of the challenges for SPs is the lack of a “one-stop-shop” for test equipment. Even though the test equipment industry is going through a series of metamorphoses and there are a higher number of integrated solutions available today, SPs are still forced to select multiple test equipment vendors for different tasks. Agilent’s acquisition of AT4 wireless will fill in the gaps in Agilent’s product offering and bring the two companies closer to this “one-stop-shop” concept.

AT4 wireless Provides a Wider Product Portfolio
Test equipment products are highly important to ensure multi-vendor interoperability.  Because LTE is operating in a multi-vendor environment, SPs and NEMs must ensure that all vendors implement the latest standards.  AT4 wireless offers a rather comprehensive suite of products for wireless certification and testing laboratories. The company’s solutions cover the following technologies: GSM/GPRS/EDGE, WCDMA, HSPA, LTE, WiMAX™, Bluetooth®, Wi-Fi®, RFID and NFC. AT4 wireless addresses the need for multi-vendor interoperability by offering a product portfolio that consists of conformance, certification and interoperability testing, as well as compliance services.  
On the conformance test side of things, AT4 wireless LTE test systems provide not only compact, but also rather cost-effective solutions for LTE terminals certification and cover RF, RRM and protocol testing requirements, including iRAT requirements.  Additionally, AT4 wireless recently announced a new LTE R&D solution, T4010 DV, a LTE RF Design Verification Tester.  It allows users to fully classify 3GPP test cases and to also create new ones, using a flexible graphic user interface. Furthermore, this solution can easily be upgraded to a conformance tester with minimum additional costs, as only the software requires an upgrade.

Other Benefits of the Acquisition
In addition to the R&D, conformance and certification testing, AT4 wireless has developed a number of IT services that consist of software-based solutions that address localization, identification, management, control, monitoring and automation. These tools meet various customer needs, including the management of exploitation services. AT4 wireless IT services are capable of combining specific products, services and systems to deliver improvements to processes and resource management. Due to a high level of automation and flexibility, many management processes are improved and can be managed at lower costs.

Conclusion
Even though only time will tell how successful an acquisition will be, the one between AT4 wireless and Agilent is most likely destined for success.  AT4 wireless had an earlier successful partnership with Agilent for several years, so this acquisition is expected to strengthen the synergies between the two companies and bring additional products and services to Agilent’s impressive global customer base.

Olga Yashkova is Program Manager for the Frost & Sullivan Test & Measurement practice. She focuses on next generation services monitoring and analyzing emerging trends, technologies and market behavior in the telecommunications test & measurement industry.