IP/MPLS, MetroE, Broadband Are Hot Investment Areas as Carriers Converge Networks

Infonetics: Service providers around the globe are shifting into high gear and making major investments to converge their data networks.

Changing traffic patterns and applications are the main causes of the convergence charge, with broadband Internet, metro Ethernet, and IP VPNs being the top three drivers causing IP traffic growth for carriers participating in Infonetics’ study.

IPTV and broadcast video, which loom large in many carriers’ plans, will create a huge increase in traffic when it becomes prevalent. Carriers expect decreases in legacy service revenue (ATM, frame relay, leased lines), but expect big increases from IP VPN, VoIP, and metro Ethernet revenue, and those planning broadband and IPTV expect sizeable revenue increases from those services as well.”

• 52% are incumbents and 48% are IXCs, competitive operators, and ISPs

• Average annual revenue was $13.5 billion in 2005

• 100% have IP/MPLS networks, 93% have Ethernet, 86% ATM, and 76% frame relay networks (but were not screened for these criteria)

Incumbents and competitive operators face significantly different challenges and opportunities as they converge their networks, as do carriers in different regions, according to the study.

• The number of carriers deploying new MPLS-based metro Ethernet equipment doubles between 2005 and 2006, from 42% to 84%

• One of the hottest market segments now and for the next five years is the cellular base station backhaul: over 50% offer mobile voice and data services, and of these, 73% build their own transport network to do the backhauling

• 100% of European, 60% of Asia Pacific, and 44% of North American broadband carriers are deploying IP/Ethernet DSLAMs in 2006

• Over half will participate in interprovider QoS in 2006; IP VPNs are the most common services that make use of interprovider QoS, both now and in 2006

• Creating new services is considered a challenge to 56% of European and 67% of Asia Pacific carriers, but to only 14% of North American carriers

Service Provider Plans for IP, MPLS, and ATM: North America, Europe, and Asia Pacific DSLAM? Wikipedia Red Viking Publ 20060111