Consolidation continues as an ongoing concern in the ISP sector with SecureTelecom’s recent acquisition of Brisbane-based data services provider iExec.
Dave Stevens, managing director of SecureTelecom and its IT services partner Brennan IT, said Telstra’s changes to its wholesale pricing were forcing many ISPs to look at acquisitions and partnerships.
“Most of the smaller ISPs are in a bit of a situation [as] there’s quite a level of control in Telstra’s hands," he said. "However teaming and partnering with other telcos will have a lot of benefits."
Stevens said ISPs that failed to diversify would find themselves subject to takeover.
"The ISPs falling out of the market are the ones that can’t offer any other services besides internet," he said. "These days they need to be able to offer unique products or flounder. It’s a bit like hardware resellers, whose days are number.”
Stevens said acquiring iExec would bolster SecureTelecom's chances by offering increased geographical spread and a larger customer base.
“The company was also very similar to ours, with customers who have 50-100 seats at the mid-market level,” he said. “We can now offer our combined customers a number of products which combine voice and data technology.”
Stevens said iExec's 22 staff would commence work under the SecureTelecom banner later this week. SecureTelecom’s total staff now numbers 155.
Stevens would not disclose the value of the deal other than to say it was for "a healthy premium.”
SecureTelecom acquires iExec
By Lilia Guan on May 30, 2006 10:32AM