Ericsson’s Cradlepoint Plays a Unique Role in the Enterprise Mobility Ecosystem

Kathryn Weldon – Research Director, Business Network and IT Services – Americas

Summary Bullets:

• When Ericsson acquired Cradlepoint in 2020, the latter was focused on enterprise wireless WAN equipment, which was considered an emerging business for the network infrastructure vendor.

• Now Cradlepoint is at the heart of Ericsson’s enterprise strategy, bringing diverse channel partners and new products with which to flesh out offerings to meet a growing demand for wireless connectivity.

When Ericsson acquired Cradlepoint in 2020 for approximately $1 billion, the latter vendor specialized in wireless WAN solutions. It offered 4G/5G mobile and fixed site cellular routers and adapters, vehicle and IoT routers, and network management software available via a cloud-based software-as-a-service platform, featuring zero-touch onboarding. At the time, it had approximately one million subscriptions among US and global enterprises, SMBs, and public sector businesses. Cradlepoint was initially part of the Ericsson Business Area Technologies & New Businesses business unit and sold its products indirectly to businesses through a diverse channel of 1,500 system integrators, CSPs, and resellers, augmenting Ericsson’s traditional channel (and primary customer base) that had long been dominated by CSPs.

Three years later, Ericsson has evolved to hold a more prominent place in the Ericsson Enterprise Wireless Solutions portfolio, along with the Ericsson Private 5G solution, which targets OT organizations in industrial environments. Cradlepoint powers the other three elements in the portfolio, including NetCloud Private Networks, a packaged private network bundle focusing on simplified networks for IT organizations launched in 2022; NetCloud Edge, which manages fixed site, mobile, and IoT wireless edge solutions; and NetCloud Exchange, which combines 5G, SD-WAN, and security via zero-trust networking into a single WWAN solution. Cradlepoint’s reseller channel has now grown to include over 5,000 companies. All tier 1 mobile operators in the US and many global operators resell Cradlepoint WWAN equipment, although its new NetCloud Private Network is currently sold only in the US with Citizens Broadband Radio Service connectivity only, with CSPs and global integrators to be added to the channel later in 2023. In April 2023, Cradlepoint acquired Ericom, which specializes in cloud-based enterprise security capabilities. Ericom will facilitate a new Cradlepoint NetCloud Threat Defense cloud service, expanding the company’s mobile-and router-integrated SASE and zero trust portfolio.

Why is Cradlepoint so Important to Ericsson?

• Since 2021, Ericsson has illustrated a strategy to penetrate the enterprise market opportunity more effectively. Currently, growth in its traditional CSP infrastructure business is limited by the CapEx constraints of operators, difficult economic times, and the eventual reduction of its service provider customers’ expenditures on 5G buildouts.
• 5G, edge computing, work from home/hybrid work, and new services such as FWA and cellular private networks have energized the enterprise mobility market. IoT connectivity is also on the rise due to sustainability requirements for measuring and managing energy usage as well as the rising use of automation in industrial environments. There is a growing acceptance of cellular as an acceptable primary access method for many use cases and a key backup technology for many others. This is due to its growing maturity, flexibility, security and management capabilities, and the longer-term promise of 5G to reduce latency and increase speeds for complex mission-critical, bandwidth-intensive applications. These mobility trends are increasingly important to Ericsson and its infrastructure competitors, most of which are also investing in edge computing, private network services, and other enterprise-facing technologies and services.
• The wireless WAN equipment market includes many able competitors such as Cisco, HPE/Aruba, Fortinet, Digi, and Sierra Wireless. Many competitive devices feature native cellular access such as the Fortinet Fortigate and some models of the Cisco Meraki MX series. However, Ericsson estimates that Cradlepoint has a 25% share of what is already a large and growing market, predicted by the vendor to grow by 68% between 2022 and 2025. Cradlepoint’s channel partners also provide Ericsson with an immediate entrée into business organizations in which it had little visibility.