Nortel dropped the other shoe this morning, in addition to their formal announcement of Project Chainsaw, by announcing their acquisiton of Diamondware (Mesa, AZ) for $10M. Diamondware is a company that provides 3D positional audio for virtual worlds and games.
This is a case of $10M providing considerable leverage. When I was at Cisco, we used to search long and hard for key technology players that had disruptive potential for the industry if acquired. A protocol stack here, a key-technology player there, and pretty soon you have a corner on the key resources needed to make a market work.
Diamondware is a key technology provider to MANY companies in the virtual world and gaming markets. For example, one of their licensees is Vivox, the people who get all the credit for providing spatial audio for SecondLife.
On a related note, Nortel announced intent to acquire PingTel about a week ago as well. PingTel makes a slick opensource, SIP-based, IP PBX for Linux. If the Nortel voice team were to combine some cool SIP-based IP Telephony kit with spatial/positional audio.........
Now that Nortel has announced intent to acquire Diamondware, expect a number of shakeups around industry as (generally) virtual world startups will be averse to using spatial-audio technology owned by a company who sells virtual world technology. If you are the CEO of some other spatial-audio vendor today, I'd go get a haircut and whiten my teeth if I were you, because you're about to get a bunch of invitations to the dance.
Good news for Nortel. My whole consciousness of the importance of positional audio comes from Diamondware, who I first met with at VON about six years back. At that point (at least in the VON marketplace) they were promoting positional+wideband audio as a conference-call enhancement. The line that stuck with me from that conversation was: "You know how you can be on a conference call with five people from your company and six people from a partner company, and you lose track of which voices are on 'your team' and which are on the others?"
Posted by: John Jainschigg | August 25, 2008 at 06:55 PM