Why the Great Internet Buildout Is Spurring M&A

If you're a BlackBerry or iPhone user/addict, then you are partly responsible for the great Internet buildout. Those cute apps that look up baseball scores or let you log into Facebook eat up enough bandwidth to put the backend infrastructure of phone companies under pressure, forcing them to upgrade their networks with new and fancy gear. Equinix, a data center provider, on Wednesday said it was going to buy competitor Switch and Data for about $689 million in cash and stock. And now Tellabs, a Naperville, Ill.-based maker of telecom equipment, says it's buying WiChorus, a mobile Internet equipment maker based in San Jose, Calif. Tellabs is paying $165 million in cash for the upstart company whose venture backers include Pinnacle Ventures, Accel Partners, Mayfield and Redpoint Ventures and which counts Clearwire among those that uses its products. WiChorus' SmartCore platform competes with the likes of Starent, which itself is in the process of being acquired by Cisco Systems for $2.9 billion. What's really going on is pretty simple: Today's consumers are increasingly spending more time on the web — and they're using the mobile web almost constantly.