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VoIP, IMS equipment price down: Study

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CIOL Bureau
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CALIFORNIA, USA: Worldwide demand for VoIP and IMS equipment are growing, which in turn is bringing down the prices of the equipment, finds Infonetics Research.

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The total service provider VoIP equipment market, including trunk media gateways, SBCs, media servers, softswitches, and voice application servers, decreased nine percent from 2Q10 to 3Q10, to $511 million, finds Infonetics Research.

Also Read: VoIP-based calling is a revenue challenge: Survey

Whereas, the worldwide IP Multimedia Subsystem (IMS) equipment market, including IMS core equipment and application servers, grew 4% in 3Q10, on the heels of a 34% jump in the previous quarter.

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Diane Myers, directing analyst for VoIP and IMS at Infonetics Research, said: “The number-one story that will come out of 2010 for the IMS and carrier VoIP equipment markets is China, where conditions are driving volumes up and pushing prices down."

While revenue is down for the quarter, shipments for almost all segments in the market are up sequentially.

"There are large network transformation projects underway in China, so demand for equipment is very strong, but at the same time, vendors are willing to push the pricing limits to get into strategic accounts."

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Asia Pacific is the only region expected to post year-over-year revenue growth in 2010 for service provider VoIP equipment.

"In the third quarter of 2010, every product category except media servers was impacted by pricing pressures, so while shipments were up for most segments, total worldwide revenue took a hit. Looking at the long-term prospects, the network elements that are best poised for solid growth are those that facilitate the migration to all-IP networks, such as session border controllers (SBCs),” notes Myers.

In 3Q10, Genband leads the combined carrier VoIP and IMS equipment market for worldwide revenue.

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IMS Market Highlights

In 3Q10, the four top vendors, Alcatel Lucent, Ericsson, Huawei, and Nokia Siemens Networks, continue to fight it out for new deals and replacement RFPs.

Ericsson and Nokia Siemens saw revenue growth with CSCF in a relatively flat quarter

Overall, the IMS equipment market is experiencing strong and healthy growth, driven in the near-term by the continued adoption of VoIP services and service provider migration of VoIP services to IMS networks.

Longer-term, the IMS market will get a boost from the push for enhanced mobile services, with LTE being the most significant driver.

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