Vibe Communications

New Zealand’s telecommunications industry consolidation continues as Vibe Communications acquires RackCentral, a troubled Australian cloud service provider.

The move gives Vibe control of the RackCentral and CloudiO brands along with the company’s more than 1500 customers.

Vibe says it has been looking for an Australian acquisition for some time.

Telecommunications is an eat-or-be-eaten world. Companies on both sides of the Tasman have been busy snapping up smaller players.

The economics of falling overall industry revenues, intense competition have lead to downward price pressures.

Those with access to capital can strengthen their position by broadening their portfolios and deepening their customer pools.

In the last year 2degrees acquired Snap, Vodafone bought WorldXchange and in another trans-Tasman deal Vocus took-over FX Networks.

RackCentral ran into trouble last year filing for liquidation when faced with disputed debt claims from Vocus and the Summit Group.

The two companies have little overlap. Vibe’s main business is in IP transit, International Layer 2 Access and VoIP. It also has a wholesale business. RackCentral sells colocation, virtual private servers (VPS), self-managed cloud hosting and physical server hosting.

Rudi Hefer, CEO of Vibe Communications, says RackCentral is a logical extension to his business.

He says the Australian company has a similar philosophy around instantaneous provisioning and service self-management. The deal will “…allow customers to create end-to-end network services, including connectivity and infrastructure on-demand, in real-time and on terms that suit them. This is something that no provider in ANZ is doing.”

One thought on “Trans-Tasman consolidation as Vibe buys RackCentral

  1. I’m always wary of mergers, but I can’t think of any other way these infrastructure companies can compete with the likes of the big international players. Hopefully this ends up good for the customers and not just good for board members.

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