CommScope Reinforces Patent Portfolio With Phluido Buyout

CommScope Holding Company, Inc. COMM recently acquired patent portfolio from Phluido, a leading provider of high-performance wireless communications. The patents, which strengthen the growing influence of virtual radio access networks (vRAN), support major Open Radio Access Network (O-RAN) and 5G networks concepts like network synchronization and virtualization. This buyout comes as a boon to CommScope, especially at a time when operators are gradually shifting from legacy networks to automated networks, to address exponential data growth with an optimized infrastructure.

Based in San Diego, CA, Phluido is a renowned name in the field of radio-as-a-service technology, software-defined radio and distributed RAN architectures. The company is best known for establishing the world’s first Cloud-RAN system. It enables service providers to seamlessly deploy 4G and 5G networks over cost-effective fronthaul links, by leveraging on resource pooling and virtualization. As a result, the service providers can minimize operational overheads up to 70% and support a plethora of deployment scenarios on the back of low-priced radio units. Further, the company has memberships in associations like O-RAN Alliance and Intel Network Builders that are committed to evolving radio access networks around the world.

Through this intellectual property acquisition, Phluido aims to expand its 5G-New Radio virtualized RAN software development and licensing business across global markets. The deal is counted as a great opportunity to boost CommScope’s overall business combined with its ONECELL patent portfolio. ONECELL enhances reliable indoor communications and uses an IT-friendly deployment model to provide best-in-class 5G performance to enterprises. Markedly, the buyout will not only broaden Phluido’s RAN software product line but also bolster CommScope’s position as an indoor RAN provider. Financial terms of the deal have not yet been disclosed.

The Hickory, NC-based company is well positioned to benefit from industry growth trends, including network convergence, fiber and mobility, IoT, demand for additional bandwidth, low latency and ultra-high reliability. It continues to focus on cutting-edge technology and an efficient supply chain. It is also optimizing its excellent customer relationships and competitive position, paving the way for healthy mobility solutions business, as communications service providers continue to build out their networks to augment capacity and coverage.

Moving forward, CommScope expects big North American telecom companies and cable operators to continue rolling out avant-garde solutions to meet rising demand for bandwidth. In addition, the company is focused on sound technology, highly-efficient supply chain and continuous improvement. This will potentially make it a preferred partner for all telecommunications businesses as the industry shifts to 5G.

CommScope currently has a Zacks Rank #4 (Sell). The stock has lost 26.9% against the industry’s growth of 57% in the past year.

Some prominent players in the broader industry are Calix, Inc. CALX, Viasat, Inc. VSAT and Sensata Technologies Holding plc ST. While Calix and Viasat sport a Zacks Rank #1 (Strong Buy), Sensata carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Calix delivered a trailing four-quarter positive earnings surprise of 59.7%, on average.

Viasat delivered a trailing four-quarter positive earnings surprise of 361.3%, on average.

Sensata delivered a trailing four-quarter positive earnings surprise of 1.2%, on average.

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