Interview with Malcolm Gordon, incoming CEO, ip.access

Malcolm Gordon ipacess 150There have been a number of significant ownership and staffing changes at small cell pioneer ip.access recently. Their new CEO Malcolm Gordon explains how they plan to make it easier for operators to invest in Small Cells, which market segment he sees as most attractive, and discusses the timeframe and relevance of LTE, LTE-U and LAA.

What’s changed at ip.access and why?

Some of our longer term investors had reached the mature stages of their investment program and were looking to move on. Zouk Capital saw great potential and has backed that up with significant investment, acquiring their shares to become the principal shareholder. The company is now fully recapitalised and has strong long term financial security.

There have also been some personnel changes, including my taking over as CEO. Nick Johnson is now performing the combined roles of CTO and head of Product Management. We continue to be based at our HQ in Cambridge UK and offshore R&D centre in Pune, India.

What will the additional investment funding be used for?

We have an ambitious product roadmap related to the latest LTE standards accompanied by important differentiating features.

We want to address the wider ongoing small cell issues so that the technology can properly break into the market in a sustainable way that encourages growth. Operators haven’t adopted them for a range of operational and logistic reasons rather than purely technical ones.

So I’m keen to adopt Nick’s initiatives and take a strong position supporting Small Cells as a Service. We find this resonates with the operator market in general. It avoids the need for large up-front operator CAPEX investments and  spreads the costs over many years. Zouk has access to capital that enables us to offer a completely different cashflow model. Our solution also offers multi-operator network support, further increasing the return. Moving forward, this will be one of the mainstays of our approach.

Each operator and region differs slightly in their needs and desires. We’d need permission to use their spectrum but would do all the heavy lifting. Operators are under potential threat from Wi-Fi operators who could steal their lunch once standalone LTE-U becomes available. We want to help operators retain control by delivering a premium service at a sustainable cost.

Which of the small cell market sectors holds most promise for ip.access?

We are much more focussed on the Enterprise solutions, in buildings with 1 to 100 people, where Wi-Fi is gaining some traction right now. We see this as the largest growth market and greatest opportunity.

We are not betting on the residential sector increasing in volume – it’s a nice upside to our revenue but our marketing and sales energy is directed towards Enterprise. This is where we see the most profitable short to medium term.  We are keen to enable our partner network to deliver residential solutions using our technology in a similar way to our deployment with AT&T.

Where are your key development resources based and why?

We took the bold move to invest in our own Indian R&D centre. It’s a fully standalone and wholly owned facility rather than just a serviced office. It’s become a mature and highly skilled development centre. We balance that with architectural control, system engineering and other key functions at our HQ in Cambridge UK.

ip.access is well known for working through partners and system integrators. How do you anticipate that will evolve?

We have a widespread range of partners and do see them as key. They allow us to access other vertical markets outside the classic operator coverage/capacity scenarios. We are expert in our own technology and actively provide support for the underlying capabilities. Our partners typically solicit pure technology platforms from a variety of sources and customise them physically and environmentally to fit a particular need. Because we are small and nimble we can be much more flexible about how we work with them. System Integrators prefer to work with standard products and this simplifies our platform.

Which radio technology is most in demand – 3G or LTE?

As the market evolves, there is demand for all three options – 3G only, LTE only and multi-mode 3G/LTE. We already have products for each radio technology and our current investment moves us towards a fully multi-mode platform.

I’ve observed some confusion around different LTE operator launch strategies.

We hear market peer pressure from different MNOs where some are trying to muscle up the agenda using LTE. They show the LTE logo on their customer’s phones which has significant marketing impact but can’t yet handle voice calls. Some have launched VoLTE but without essential features such as e911 emergency calling.

Having widely deployed and mature GSM and 3G technology allows us to combine them with LTE in ways that others find hard to follow. This allows us to exploit our existing assets while VoLTE  matures and becomes more widely supported through deployed smartphones. Once these are in place, a multi-mode solution will further accelerate small cell adoption.

Unlike some small cell vendors, ip.access have their own small cell gateway. Is this a benefit or a distraction?

Definitely a significant benefit. It ensures we can offer our customers a full solution with little or nothing to think about

Our gateway can definitely support multi-operator deployments although we haven’t commercially deployed in that configuration as yet. We can package the gateway and management system to operate within either a private or public cloud.

Is LAA/LWA a distraction or a potential saviour for the Small Cell Industry?

Nick Johnson has spoken at several conferences about the topic. We think the LBT (Listen Before Talk) issue will level the playing field between LTE-U and Wi-Fi, so that any performance gains you might expect from LAA don’t make it worthwhile. (This depends on which of the technical options being considered becomes adopted).

We like multi-path TCP/IP and using session based routing of traffic, which is much simpler than even LWA (LTE Wi-Fi Access). We also note the potential for LTE-U which allows a completely standalone LTE network running only in unlicenced spectrum. It’s potentially an interesting market for us that goes beyond the operator – we could sell directly to end users – but are less convinced about the long term potential for LAA. We see the industry could achieve a quicker win by making fuller use of Wi-Fi in all its forms.

And let’s not forget that small cells are an essential precursor for any of the above – you need to deploy them first before adding LTE-U, LWA or LAA.

Closing thoughts?

You asked if we were late to market with a 3G/LTE multimode small cell. That implies that we are losing market share to other vendors. While we can see that Wi-Fi is doing well in its equivalent market, I don’t believe  that we’ve lost out on the LTE market. Instead, we have managed the maturity of our solution  to align with our view of  the market timeframe.

I’m not uncomfortable with our LTE product timescales – we’ve already got 20 customers for it to date – and feel success is much more about matching market traction with the offerings we take to market.

ip.access is a sponsor of ThinkSmallCell

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