Summary:

Sierra is exiting the mobile hotspot and dongle business so it can concentrate on the growing machine-to-machine market and embedded connectivity.

Sierra Hotspot Tri-Fi

The company that coined the term AirCard will make AirCards no more. Sierra Wireless is selling its 3G/4G modem business to NetGear, which take over the manufacture of its line of mobile hotspots, wireless dongles and data cards.

NetGear will pay $138 million in cash and assume $6.5 million in liabilities as part of the transaction, which will allow the popular Wi-Fi router maker to expand beyond wired and Wi-Fi networking into the cellular market.

External modems were once Sierra’s bread and butter, but over the last five years it began to focus much more an embedded radio modules and the machine-to-machine market, making a few key acquisitions along the way. Meanwhile cellular modems are becoming more of a commodity business.

Sierra has probably seen the writing on the wall. As more smartphones and tablets come with their own hotspot capabilities there will be less need for stand-alone modems, so it’s a market it seems ready to concede to Novatel, Option and networking gear makers like NetGear.

Meanwhile, as the internet of things take shapes more and more devices will start sporting cellular radio connectivity – not just laptops and tablets but also home appliances, cars and even wearable electronics. It’s in those devices Sierra wants to embed its connectivity.

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