RIM buys SlipStream Data
Ability to compress wireless data draws interest of BlackBerry giant
WATERLOO (Jul 11, 2006)
The folks at Research In Motion didn't have to make any long flights to wrap up their latest acquisition.
They only had to go across town to seal the deal to buy SlipStream Data, a six-year-old University of Waterloo spin-off whose data-compression technology will boost the performance of RIM's popular BlackBerry e-mail device in future models.
The deal, which closed on the weekend, was announced yesterday by RIM founder Mike Lazaridis and SlipStream president Ron Neumann.
RIM wanted SlipStream's technology, but it also came to appreciate how similar the two firms are in terms of culture and their approach to business, Lazaridis said.
"The silver lining of the whole thing is they are in the same city," he said.
For SlipStream, it's a great opportunity to grow under the wings of a technology leader, Neumann said.
"It's two companies with similar aspirations growing in the same town," he said. "In some ways, it's almost inevitable that it happened."
Neumann said SlipStream's 49 employees were thrilled by the news.
"Our technology and product and our relationships have always been special, but to see them brought up to the higher level we will be able to achieve with RIM, it is going to be much more exciting for us," he said.
"Of course, they are excited," Lazaridis added. "They're all going to be getting BlackBerrys."
Iain Klugman, president of the Communitech technology association, said the acquisition proves, once again, that the region is home to some of the best technology minds.
"I'm certain that when RIM does an acquisition, it looks for the very best technology in the world," he said. "It's exciting that they found it right here in our own backyard."
SlipStream, founded by UW professors En-hui Yang and Ajit Singh, develops technology that compresses bits of data so it can be moved more quickly through communications networks.
The company, which has been profitable since 2003, initially focused on the dial-up Internet market. Its technology, used by more than 2,200 Internet service providers around the world, allows dial-up users to download information up to seven times as fast as with normal dial-up service.
More recently, the firm moved into the wireless space, developing compression technology for mobile devices.
That's what attracted RIM.
Compression is a huge issue in mobile communications. The bandwidth, or capacity, of wireless networks is limited, so providers of wireless services need to find ways to squeeze more through their pipelines to give customers faster, less expensive service.
The need for compression becomes more critical as devices gain new features and customers clamour for more services, Lazaridis said.
Lazaridis, RIM's co-chief executive officer, said the company bought Slipstream (the financial terms weren't disclosed), rather than coming to some arrangement to use its technology, because of its demanding security and quality requirements.
"We couldn't just do this with an arm's length arrangement," he said.