There were two high profile pieces of M&A news in the IoT hardware space in late July/early August. On Friday 29th July Telit and Thales announced that they were combining the assets of Telit with those of Thales’ IoT hardware business into Telit Cinterion. That was followed on 2nd August by the news that Semtech Corporation would acquire Sierra Wireless.
These announcements affect all three of the triumvirate of cellular IoT hardware makers that dominated the global market as little as a decade ago. Going back ten years, collectively Cinterion, Sierra Wireless and Telit accounted for the majority of IoT shipments. However, since then competition has bitten and they now find themselves as minority players.
The requirement to gain scale in the face of (particularly Chinese) competitors goes a long way to explain why each would want to find greater scale. But the two deals demonstrate a rather different approach. Telit Cinterion is a straightforward merging of like companies. The Semtech/Sierra Wireless deal has more complexity, given Semtech’s position as the leading player in the LoRaWAN ecosystem.
In this report we explore the background to these two deals and examine the significance to how IoT might be delivered.