Telecom service layer software firms Aepona and Appium have agreed to merge to chase the growing market for service delivery platforms. That market is forecast by OSS Observer to grow from $1.4 billion this year to $3.2 billion by 2011.

The combined company will retain the Aepona name. Aepona currently is headquartered in Belfast, United Kingdom, and Appium, which develops application server and service creation environment products, is based in Malmö, Sweden. The headquarters will continue to be in Belfast, with the Malmö facility continuing to serve as a development center and regional sales office.

"There are a number of compelling reasons behind the decision to combine the strengths of Aepona and Appium" said Gilbert Little, chairman of Aepona's Board of Directors, in a statement. "Service Providers globally are set to invest heavily in this segment to satisfy the demand for rich, converged consumer and enterprise services. The two companies have complementary products, customers and channels to market, and the combined entity has the scale, intellectual assets and sales and marketing fire-power to fully capitalise on this exciting market opportunity."

The combined company’s service layer products will include Telecom Web Services framework, Service Broker, Telecom Application Server, Service Creation Environment and Convergent Network Gateway. The products will be marketed under Aepona's existing Universal Service Platform (USP) banner. The combined company’s customers include the France Telecom/Orange Group, BT, Sprint, Telus, Telefonica, KPN, Bharti, Telmex and Vimpelcom. The two companies have previously worked together in delivering end-to-end solutions to customers such as France Telecom/Orange, demonstrating the complementary nature of the existing Aepona and Appium products.

"This deal makes a lot of sense for both companies", said Jean-Charles Doineau, Service Infrastructure Practice Leader at research firm Ovum. "Whilst it is clear that there is a significant and growing market opportunity for independent software vendors within the service platform segment, this can only be addressed by companies with real credibility in the marketplace.”