Partners Cheer Verizon's Fleetmatics Acquisition, Laser Focus On IoT

Partners of Verizon are applauding its plans to acquire Irish fleet and mobile management provider Fleetmatics Group, saying it will build up the telecommunications giant's growing presence in the telematics space.

Earlier Monday, Verizon announced it would buy Fleetmatics for $2.4 billion. Fleetmatics offers cloud-based GPS tracking and mobile workforce management solutions to monitor vehicle location, fuel usage, speed and mileage.

The deal demonstrates that Verizon is serious about building out its Internet of Things strategy. Meanwhile, partners say, the acquisition shows that the carrier is keeping its eye on the same trends that are catching the attention of solution providers.

[Related: Verizon To Acquire Fleet And Mobile Management Provider Fleetmatics For $2.4 Billion]

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One Verizon partner executive, Rob Chamberlin, co-founder and chief revenue officer for DataXoom, a Walnut Creek, Calif.-based solution provider that specializes in mobility services, is glad to see the Basking Ridge, N.J.-based carrier reinforce its focus on business-grade solutions for the channel.

"Unlike Verizon's recent push into content [with its] AOL, and Yahoo acquisitions, which seem to be more focused on the consumer market, the connected devices strategy is very suitable for the partner channel," Chamberlin said.

Verizon buying into the IoT space is important because it will start to drive more consistency around IoT data best practices, said Michael Goodenough, vice president of cloud solutions for New York-based BCM One, an IT consulting and managed services provider that also partners with Verizon.

"I think it's brilliant, and I think the market is in demand for a simple, mobile platform for IoT devices," he said.

Solution providers that are connecting devices need a platform for those efforts to prove effective, Goodenough said.

"Without [a provider] like a Verizon, we're not able to connect all of those devices so that everything works together," he said.

Verizon did not respond to CRN’s request for comment on the Fleetmatics acquisition, or on what the deal will mean for partners, by publication time.

Verizon first dived into the telematics space with Networkfleet, the location monitoring and real-time automotive diagnostics technology the carrier acquired as part of its Hughes Telematics purchase in 2012 for $612 million. The purchase launched Verizon Telematics, a subsidiary of Verizon Communications that's still based at Hughes Telematics' former headquarters in Atlanta.

Verizon's Telematics business unit has been gaining momentum recently. Last week, the carrier closed its acquisition of Telogis Inc., a fleet management software provider based in Aliso Viejo, Calif. The two companies did not disclose the terms of the transaction.

DataXoom's Chamberlin said that judging by Verizon's recent merger and acquisition activity, the carrier clearly intends to be a leader in IoT and telematics.

"I could absolutely see partners bundling the Verizon Networkfleet/Telogis/Fleetmatics with mobile data connectivity," he said.

Telecommunications providers have been busily building up their IoT strategies this summer. In July, Dallas-based carrier AT&T announced an expanded partnership with IBM that combines Big Blue's developer tools, as well as its cloud and analytics services, with AT&T's IoT platforms and global network. The collaboration gives developers a common set of IoT development tools, according to AT&T.

Not to be outdone, CenturyLink last month revealed a joint solution with Cisco and CenturyLink's location-based analytics. The platform lets businesses tap into connected devices and big data using a combination of the Cisco Meraki line of cloud-controlled access points and security appliances, along with CenturyLink's managed Wi-Fi offering and an analytics platform.

Also last week, Verizon announced it would acquire ailing internet giant Yahoo for $4.83 billion.

Under the terms with Fleetmatics, Verizon said it will acquire the company for $60 per share in cash. The buyout is subject to regulatory approvals and expected to close by the end of the year.