Vonage Acquires iCore, Grows as Enterprise Player

Vonage is making its move in the Unified Communications-as-a-Service (UCaaS) market, with several new changes that will expand its portfolio and its standing in the market. The company’s latest acquisition is UCaaS provider iCore Networks, Inc., further boosts Vonage Business’ UCaaS portfolio, sales force, and ability to reach mid-market and enterprise customers.

iCore provides a wide range of video, voice, mobile, and collaboration services, sold primarily through its direct sales force. Additionally, iCore offers a Microsoft Lync-as-a-Service solution, and several complementary cloud services, including Infrastructure-as-a-Service and hosted Microsoft Exchange. As it uses the same BroadSoft BroadWorks call processing platform as Vonage, integration for iCore customers should be a relatively smooth process.

The Merger Agreement has been approved by both Vonage and iCore’s board of directors, and is estimated to close by the end of 2015’s third quarter. As per the agreement, iCore shareholders will receive $92 million, approximately 30 percent more than iCore’s estimated 2015 revenues.

This is the latest in a series of strategic acquisitions for Vonage, which has helped move it up as a key player in the UCaaS market. In 2014 it acquired Telesphere Networks for $114 million in cash and stock, adding a business phone service, videoconferencing, mobile office solutions, and a nationwide cloud platform to its offerings.

Following that, earlier this year, Vonage acquired Simple Signal for $25 million. That acquisition added a focus on smaller businesses, in addition to the medium and large-sized businesses it brought in from Telesphere’s customer base.

Let’s also not forget Vonage’s purchase of Vocalocity, renamed Vonage Business Services, for $130 million. Following the more recent acquisitions, Vonage created the Vonage Essentials and Vonage Premier product offerings, providing sets of communications solutions for customers of all sizes. In a recent quarterly results call, Vonage CEO Alan Masarek explained: “The creation of Essentials and Premier and the alignment of our sales force to drive the right products to the right customer are critical steps for Vonage. By operating two platforms at scale we delivered products and solutions addressing the needs of diverse customers while maximizing our subscriber economics regardless of the segments served.”

According to Blair Pleasant of UCStrategies, “Vonage has done a good job of transitioning from being a consumer-focused business to also offering business-grade solutions, and has acquired many of the necessary unified communications and collaboration capabilities through its acquisitions. The acquisition of iCore should help the company move into additional mid-market and enterprise accounts, while expanding its sales force. However, as with any company that makes several acquisitions within a short time frame, Vonage will have to work hard to align its various technologies and service offerings, while providing the necessary training for its sales force and indirect channel.”

Between all these acquisitions and its new product offerings, Vonage is boosting its market position and reach. Its growth has been worthy of notice, so it’ll be interesting to see where the iCore acquisition takes it.