Silver Spring Networks buys French Internet-of-streetlights company

PARIS -- Silver Spring Networks has acquired Streetlight.Vision, a French company that helped it bring Internet-enabled streetlights to cities including Paris, Copenhagen, Dublin, Miami, Oslo, and Barcelona, Spain.

The companies announced the completion of the $8.75 million acquisition at a press conference Wednesday, fittingly held here in the city of light. San Francisco-based Silver Spring also said it's turning the Streetlight.Vision offices into its new European research and development center.

Silver Springs Networks, 12 years old and with about 700 employees, concentrates on network technology that lets customers like utilities manage their equipment remotely and improve its efficiency. Streetlight.Vision, with 15 employees, writes software for managing streetlights on an Internet network, but the acquisition will speed its expansion into other domains.

Much of the work in this "smart city" domain is largely invisible to the average person. But with regulatory and budget pressures pushing cities to cut costs and improve services -- the streetlight technology halves power consumption -- it's the kind of thing that ultimately could lower city dwellers' utility bills, ease their traffic, and find them an empty parking space.

"Smart cities are going to become about much more than lighting projects," said Eric Dresselhuys, Silver Spring Networks executive vice president and co-founder. "We think Streetlight.Vision is very well-positioned to extend their product to support more things. You can imagine traffic safety, environmental monitoring, waste control -- any number of applications that affect how we live our lives in urban environments every day."

Streetlight.Vision's software will become the foundation of that expansion, he said.

The company hardly has a lock on the market, though. IBM has been pushing its own smart-cities technology for years, and on Wednesday announced that Minneapolis and Montpellier, France, are both using its technology for monitoring and managing traffic, water, and emergency services.

The French connection

It can be difficult for US firms to acquire those in France. Yahoo's attempted acquisition of DailyMotion was rebuffed by the French government, which had a stake in the video-sharing site through its partial ownership of Orange, formerly known as France Telecom. And right now, General Electric is having difficulties acquiring Alstom's energy-industry assets.

But French politicians were on hand to support Silver Spring's acquisition -- as long as it supports France, too.

"Silver Spring's commitment to continued investment in new smart-city technologies...reinforces Paris' position as a global innovation engine and growing center of engineering excellence," said Paris Deputy Mayor Jean-Louis Missika.

Streetlight.Vision didn't encounter any governmental fretting, said Christophe Orceau, founder and general manager of the startup. But then again, "We are a small company, way under the radar," and the acquisition was in line with governmental priorities. "What is important for France is employment," and the acquisition will supply funds that could mean a doubling of the French workforce, he said.

Although there can be resistance to the idea of ceding control to overseas corporations, the Paris Region Economic Development Agency actually plays matchmaker to such outside interest, its director general, Sabine Enjalbert, said at the event. It's got offices in Boston and Silicon Valley to help make the connections.

"We connect with companies overseas which are willing to expand in Europe," she said. "We are trying to make sure they settle in the region. We are very happy to have new investors creating value in the region."

Internet of Things on the way

Silver Spring's work is an embodiment of an idea broadly called the Internet of Things, in which network technology spreads beyond ordinary PCs and phones into everything from cars to thermometers. It's made possible by steadily dropping prices for network equipment, the IPv6 Internet foundation that accommodates vastly more devices than the IPv4 technology in use today, and the ambition of companies that are trying to profit from the spread of computing technology to new domains.

In Silver Spring's case, the idea is to build networks that help utilities and city governments manage their infrastructure better. The streetlight-based wireless network work helps cities cut power consumption by about 50 percent -- 70 percent in the case of Oslo -- according to Orceau.

How exactly? First, by moving from on-off switches to dimming that cuts power when possible -- for example, when motion detectors show nobody is in a park or on a road. Second, by more precisely controlling the on-off time that varies through the seasons. Third, by knowing when broken relays or other problems mean lights shine all day long.

About 50,000 Paris streetlights are in the network now, roughly a quarter of the city's total, and more are being converted. Streetlights are a great base for a mesh of wireless network nodes that can transfer data and control signals across a city, with a ready supply of power and a vandalism-proof height. Once a network is installed, other can take advantage of the streetlights' connections.

Beyond streetlights, Silver Spring is trying to bring its technology to a variety of "smart city" areas like sensors for monitoring carbon dioxide levels, power distribution, parking space capacity, and water leaks, Dresselhuys said. That dovetails with Streetlight.Vision software, which already has expanded beyond streetlights to control software for electric vehicle charging stations, weather monitoring, energy meters, and environmental monitors, Orceau said.

The networked streetlights provide economic value, but they're also a foot in the door for bigger deals.

"The secret is that once you do that, you will have the infrastructure in place to do all the other things," Dresselhuys said.