Yankee Group Research Finds Market for Softswitches in Carrier Networks Estimated to Grow to Over $4.3 Billion in 2004 - Industry Trend or Event

Cambridge Telcom Report, June 5, 2000

The Yankee Group's latest Report, "Softswitches: The Brains Behind the Brawn," analyzes the market for the elements of carriers' new convergence networks: call control, signaling and the migration from the PSTN to packetized voice. At the heart of this new network lies the "softswitch," a term that has generated at the same time buzz and confusion. The Yankee Group Report clarifies the definition of a softswitch, examines the up-and-coming market for softswitches, and identifies some of the hot protocols and players that are vying for the coveted, critical piece of.

The Yankee Group believes that service providers are changing the way they build out their networks to accommodate the high volumes of data traffic. At the heart of this shift is the distributed architecture discussed in this Report, which allows voice and data to converge into one seamless network. The three-tiered architecture separates out switching, call control, and enhanced applications to give the service provider more flexibility and control over their own networks.

"The implementation of this architecture will revolutionize the way we do business and communicate over public networks, and the softswitch products will play a key role in enabling this revolution," says Christin Flynn, senior analyst in the Yankee Group's Carrier Convergence Infrastructure Planning Service. "The market is not without its challenges, however, as service providers require scalability, flexibility, and reliability regardless of the underlying technology in their networks." The Yankee Group estimates revenues for this market were $104 million in 1999, and forecasts that revenues will exceed $4.3 billion by 2004.

This Report examines start-up vendors such as ipVerse, telecom technologies, inc., and IPCell, as well as more established players such as Nortel, Lucent, and 3Com. Additionally, the Report includes:

* Carrier challenges in building the new networks,

* The distributed architecture that carriers are adopting to overcome those challenges,

* Protocols that will play a key role in enabling the new architecture,

* Definition of a softswitch, and * Specific vendor profiles.

The Report concludes by discussing the state of the market today and where The Yankee Group sees it s going in the next 18 months.

The Yankee Group is an internationally recognized leader in technology research and strategic consulting, whose broad-reaching analysis encompasses all areas essential to e-business success: the Internet, electronic commerce, communications, wireless/mobile, computing, and enterprise applications. The Yankee Group specializes in assisting companies with their e-business, enterprise networking, and Internet technology and electronic market initiatives while maintaining synergy with their overall business strategies. The Yankee Group continues to distinguish itself by providing personalized one-to-one analysis and planning assistance to its customers.