Mindspeed & SpiderCloud Get Small for Big Biz

Mindspeed Technologies Inc. (Nasdaq: MSPD) must have had its spidey senses tingling when it decided to work with a small startup called SpiderCloud Wireless to develop an indoor wireless system for large enterprises.

SpiderCloud, of course, has nothing to do with Spiderman, or clouds. Rather, the company has developed an indoor 3G coverage system — called the Enterprise Radio Access Network (E-RAN), but often referred to as a mobile network in a box — that operators can sell to their large enterprise customers. (See Look Out – Here Comes SpiderCloud!)

And much of what makes that product different is due to the joint development work SpiderCloud has done with Mindspeed, the companies claim. The two firms have been working together from SpiderCloud’s beginning in 2007, when it was formed by some former employees from Flarion (which was acquired by Qualcomm Inc. (Nasdaq: QCOM) in 2005), Cisco Systems Inc. (Nasdaq: CSCO) and Juniper Networks Inc. (NYSE: JNPR). At that time, though, the Mindspeed team would have worn Picochip badges, before Mindspeed acquired the femto chip specialist in January this year. (See Mindspeed Snaps Up Picochip for $51.8M.)

Specifically, the companies say they have together developed a customized baseband processor that has scalable and self-organizing features. The E-RAN system uses SpiderCloud’s software stack, including the firm’s own physical layer software (PHY) implementation on Mindpeed’s system-on-chip (SoC). The PHY, in particular, is what enables the system to handle fast hand-offs among the small-cell access points so that users don’t lose connectivity when moving around their offices. Also, it makes the system capable of handing several thousand users.

SpiderCloud has gotten the notice of Vodafone UK , for one, which has installed the E-RAN at several U.K.-headquartered businesses. And it has partnered with NEC Corp. (Tokyo: 6701), which will resell the system. (See Vodafone, SpiderCloud Build Enterprise 3G Networks and NEC, SpiderCloud Team on Indoor Enterprise Small Cells.)

Why this matters
SpiderCloud is an interesting startup to watch in the small-cell market, particularly as its system is so squarely aimed at the big business customers of mobile operators. But the fact that it is only now revealing details how its product was developed and with whom shows just how difficult the enterprise market has been to crack for small-cell companies.