| HELSINKI, Sept 19
HELSINKI, Sept 19 Venture capital-backed telecom
gear startup SpiderCloud Wireless aims to tap into the emerging
market of small wireless networks which can be used inside
offices, shopping centers and stadiums.
Telecom operators around the world are struggling with a
shortage of network capacity as the use of video on smartphones
and tablets proliferates, and are seeking new solutions to the
Many of them have added new sites to manage the growing
problem, but the technology just for a large base station can
cost up to 40,000 euros ($55,000), while site and tower costs in
towns could be much larger.
By comparison a basic small cellsite costs as little as
$100. Such sites can then by linked together with SpiderCloud's
technology, to be rolled out later on Monday, replacing the
need to buy additional large base stations.
"We are seeing growing demand for ultra cheap, operator
owned and managed small cell solutions for creating high speed
mobile data coverage and capacity in enterprise environments,"
said Pal Zarandy, a partner at Helsinki-based consultancy
Rewheel, which advises operators on data strategy.
Research firm Mobile Experts has forecast the market for
such small cells to reach 7 million units in 2013 and grow to
15.5 million by 2016.
"There is a huge macro trend towards smaller cells," said
Mike Gallagher, chief executive of SpiderCloud. "We can build a
very big franchise here."
Analysts said the demand for solutions like SpiderCloud's
was growing, but warned it could still be a tough sell to large
"It would fit the job, but getting operators to buy in on it
is still tough," said Earl Lum, founder of research firm EJL
SpiderCloud said it was working with a few major operators
already, but declined to give any names.
CEO Gallagher is a former president of Flarion Technologies,
which was sold to Qualcomm for $600 million in 2006,
and has worked for several technology firms which have been sold
over the years to bigger players like Nortel Networks.
SpiderCloud is trying to find a niche in a market dominated
by major firms like Ericsson (ERICb.ST), Nokia Siemens Networks
, Huawei and Alcatel-Lucent , but
Gallagher said there was no plan for quick sale.
"It would be nice to take one public," said Gallagher.
Founded in 2008, SpiderCloud Wireless has raised around $70
million from Charles River Ventures, Matrix Partners, Opus
Capital and Shasta Ventures.
($1 = 0.725 euro)
(Editing by David Holmes)