BroadSoft Acquires HIPCOM, Will Expand Offerings in UK

BroadSoft’s recent acquisition of HIPCOM made it possible to gain quick access to the U.K. hosted PBX (News - Alert) market. Given recent transactions, it appears that BroadSoft is not content to stop there and may seek further expansion into European markets.

The Gaithersburg, Md.-based company offers white label VoIP and hosted PBX solutions to communications service providers (CSPs) that resell the services to business customers. BroadSoft’s (News - Alert) vice president of sales, Joshua Holmberg, will be discussing business communications at the upcoming ITEXPO event next week in Las Vegas, Nev., in a session called “Why the Future of Business Communications is in the Cloud.”

The company’s products include BroadWorks, a unified communications solution that supports voice, fax, video and e-mail. Hosted cloud-based communications is available through the BroadCloud solution. BroadTouch is a UI accessible from a desktop PC, laptop or mobile device that lets users change settings from practically anywhere.

Hosted IP Communications (Europe) Limited or HIPCOM is basically a U.K. equivalent to BroadSoft, offering wholesale services there. It claims to be the first supplier of agile telecoms where mobile technology, cloud and equipment on the premises are seamlessly integrated together.

This isn’t the first time that BroadSoft has used the acquisition of another company to expand its services. In August 2012, it acquired the assets of Spring, Texas-based Adaption Technologies, which provided hosted VoIP service. The addition allowed BroadSoft to add more features to BroadCloud and help resellers get unified communications solutions delivered faster.

The company feels that there is a lot of potential growth in unified communications based on employee mobility:

"Our second quarter performance was driven by the positive results our customers are experiencing with their hosted Unified Communications (News - Alert) services in the marketplace," said Michael Tessler, president and chief executive officer of BroadSoft. "There are many factors driving the demand for hosted Unified Communications, including the growth of mobile workers."

A Briefing.com summary states that the acquisition of HIPCOM should add $500,000 in revenue for the third quarter and $1.6 million in 2013 results. A look at StockScouter ratings shows the company rated as a hold. Earnings are a mixed report; recent reports showed higher than expected earnings, but not all analysts have a positive outlook. Financial institutions have been accumulating shares.

With the two latest major acquisitions of Adaption and HIPCOM, BroadSoft looks like it wants to move fast in gaining market share for hosted PBX and unified communications in the U.S. and Europe. The financials show some positives, but the company will have to show better earnings to impress the bulk of analysts.