TeleconferenceTracking IMS Vendor Activities in North America and EuropeLars Godell Michele Pelino

Principal Analyst Senior Analyst

Andrea Carini

Senior Research Associate

Forrester Research

March 1, 2007. Call in at 10:55 a.m. Eastern Time

2Entire contents © 2007  Forrester Research, Inc. All rights reserved.

Agenda

• IP multimedia systems (IMS) in telecom

• IMS activity tracker methodology

• Comparison of IMS activities in North America and Europe

• IMS takes baby steps, but still has a long way to go

3Entire contents © 2007  Forrester Research, Inc. All rights reserved.

Agenda

• IP multimedia systems (IMS) in telecom

• IMS activity tracker methodology

• Comparison of IMS activities in North America and Europe

• IMS takes baby steps, but still has a long way to go

4Entire contents © 2007  Forrester Research, Inc. All rights reserved.

IMS is not a product; it is an open, standards-based framework

Network evolution

— Legacy networks — — IMS framework —

Service layer

Control layer

Transport layer

Wireline Cellular

Application servers

Content servers

Media gateways Charging

Session control Provisioning

Service

Control

Transport Mediation

IP and SIP are used to communicate between the IMS network abstract layers

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Once ready, IMS should enable carriers to deploy new services at reduced costs

• Lowers OPEX and CAPEX costs

» CAPEX reduction by core infrastructure reuse

» OPEX reduction by expediting time to market for new services

• Supports faster innovation

» Less risky product experimentation

» Leverages reusable modules, eliminates legacy stovepipe inefficiencies

• Enables new types of rich, multimedia applications

» Helps increase ARPU

» Staves off Internet application competition

» Increases revenue from new applications

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Vendors are hyping the technology

• They promise that today

» IMS will unleash a myriad of new revenue-generating services

» IMS will transform the telco industry

• But carriers are optimistic too . . . though more grounded

• Service providers care as well

– Mobile pure-plays, fixed pure-plays, fully integrated fixed and mobile, cable, new entrants

7Entire contents © 2007  Forrester Research, Inc. All rights reserved.

Early IMS lessons address three issues

• Technology

» Implement security to prevent unauthorized access to IP traffic

» Address interconnect issues as traffic crosses carrier networks

• Organizational

» Facilitate interaction between network and IT organizations

» Establish standardized management processes

• Operational

» Develop robust relationships with network operators

» Establish a technical support team to address fixed and mobile network issues

8Entire contents © 2007  Forrester Research, Inc. All rights reserved.

Agenda

• IP multimedia systems (IMS) in telecom

• IMS activity tracker methodology

• Comparison of IMS activities in North America and Europe

• IMS takes baby steps, but still has a long way to go

9Entire contents © 2007  Forrester Research, Inc. All rights reserved.

Data includes publicly available and self-reported vendor activities

Datacollection

• Vendors voluntarily provided details on IMS deals signed in H1 2006 including: operator type, geographic scope, announcement date, and terms of the deal.

• Secondary research was conducted to identify publicly available IMS activities from five additional vendors.

10Entire contents © 2007  Forrester Research, Inc. All rights reserved.

A broad definition of IMS was used

DataCollection

Taxonomy

• Deals included IMS-specific application servers, softswitches, HSS, CSCF, MRF, and MGCF modules used for IMS-based services such as IPTV, push to talk over cellular, mobile instant messaging, and video sharing.

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Many vendors participated in the 1H 2006 IMS tracker study

DataCollection

Taxonomy Vendors

• Vendors grouped into seven categories:

» System integrators

» Applications server vendors

» Softswitch vendors

» Billing providers

» Media gateway vendors

» Telecom equipment manufacturers

» Signaling vendors

• Vendor participants included:

Alcatel-Lucent, Apertio, BroadSoft, Cantata, Cisco Systems, Comverse, Ericsson, HP, IBM, Juniper Networks, Motorola, NexTone, Nokia, Nortel, Siemens, Sonus, Tekelec, Telcordia

12Entire contents © 2007  Forrester Research, Inc. All rights reserved.

Service providers were segmented into categories

DataCollection

Taxonomy VendorsTelco

buyers

• Grouped service providers into four categories:

» Integrated fixed and mobile operators, mobile only, fixed only, and cablecos

• Subdivided carriers into tiers:

» Tier one carriers — Market leaders in their geographic region with a large subscriber base or multinational presence.

» Tier two carriers — Compete with the tier one carrier in a particular geographic region.

13Entire contents © 2007  Forrester Research, Inc. All rights reserved.

Data was compiled and filtered to ensure accuracy

DataCollection

Taxonomy VendorsTelco

buyersData

cleansing

• Excluded deals not completed in Q1 or Q2 2006 or that fell outside Europe and North America

• Deleted duplicate information by cross-checking press releases with vendor-reported information

14Entire contents © 2007  Forrester Research, Inc. All rights reserved.

IMS tracker activities were categorized based on functional layers

Datacollection

Taxonomy VendorsTelco

buyersData

cleansingIMS layers

• Categorized IMS activities into two functional layers:

» Core network layer — Includes call session control function, media resource function, and media gateway control function components

» Service layer — Includes the home subscriber server and applications server

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Activities were also segmented based on phase of the deployment process

DataCollection

Taxonomy VendorsTelco

buyersData

cleansingIMS layers

Deploymentanalysis

• Five stages in the IMS deployment process road map:

» 1) Commercial commitment

» 2) Trial or testing

» 3) Deployment scheduled

» 4) Installation

» 5) Service launched

© 2007, Forrester Research, Inc. Reproduction Prohibited

Overall, telecom equipment manufacturers led the IMS activity charge in 1H 2006

January 2007, Market Overview “The Reality Of IMS Activities”

17Entire contents © 2007  Forrester Research, Inc. All rights reserved.

Agenda

• IP multimedia systems (IMS) in telecom

• IMS activity tracker methodology

• Comparison of IMS activities in North America and Europe

• IMS takes baby steps, but still has a long way to go

© 2007, Forrester Research, Inc. Reproduction Prohibited

Equipment manufacturers dominated European IMS activities, and billing providers led in North America

January 2007, Market Overview “The Reality Of IMS Activities”

© 2007, Forrester Research, Inc. Reproduction Prohibited

Mobile or fixed carriers are the key IMS activity participants in both geographic regions

January 2007, Market Overview “The Reality Of IMS Activities”

© 2007, Forrester Research, Inc. Reproduction Prohibited

Tier one carriers in both regions signed multiple deals, while Tier two carriers tested the IMS waters

January 2007, Market Overview “The Reality Of IMS Activities”

© 2007, Forrester Research, Inc. Reproduction Prohibited

Most IMS activities were in the trial or installation phaseJanuary 2007, Market Overview “The Reality Of IMS Activities”

© 2007, Forrester Research, Inc. Reproduction Prohibited

North American deals focused on the control layer while Europe split between control and service layers

January 2007, Market Overview “The Reality Of IMS Activities”

© 2007, Forrester Research, Inc. Reproduction Prohibited

Push to talk over cellular and VoIP were the most common services launched

January 2007, Market Overview “The Reality Of IMS Activities”

24Entire contents © 2007  Forrester Research, Inc. All rights reserved.

Agenda

• IP multimedia systems (IMS) in telecom

• IMS activity tracker methodology

• Comparison of IMS activities in North America and Europe

• IMS takes baby steps, but still has a long way to go

25Entire contents © 2007  Forrester Research, Inc. All rights reserved.

Key challenges with IMS deployment initiatives

• Services launched do not require full IMS networks for successful deployment

• IMS standards are not finalized

» Interoperability is promised but no single governing body

• Inconsistent definition of IMS components within vendor community

• No fully IMS compliant network announcements by service providers

• IMS isn’t the only game in town

26Entire contents © 2007  Forrester Research, Inc. All rights reserved.

Next steps

• H2 2006 IMS activity tracker data gathering in process

» Includes North America, Europe, and Asia Pacific geographic regions

• Continued focus on IMS in 2007 research agenda

» H2 2006 IMS activity trends

» In search of the killer IMS application

» Are IMS standards required for deployment?

» IMS network definition and components

27Entire contents © 2007  Forrester Research, Inc. All rights reserved.

Relevant research

• January 17, 2007, Market Overview “The Reality Of IMS Activities”

• December 7, 2006, Best Practices “Strategies For Vendors To Own The Service Delivery Platform Market”

• November 15, 2005, Trends “IMS Will Transform Telecom”

28Entire contents © 2007  Forrester Research, Inc. All rights reserved.

Questions?

29Entire contents © 2007  Forrester Research, Inc. All rights reserved.

Lars Godell Michele Pelino

lgodell@forrester.com mpelino@forrester.com

Andrea Carini

acarini@forrester.com

www.forrester.com

Thank you