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Carriers invest in convergence

Out with the old, in with the new

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Many North American and European service providers are planning transitions from their current networks to next generation converged networks, according to an Infonetics Research study published today.

Despite a "lean capex environment, service providers are increasing their investments in IP, MPLS [Multiprotocol Label Switching - an important traffic management protocol], broadband, and metro Ethernet", Infonetics reports.

For years networking vendors have pitched the idea that by transitioning from older data networking technologies (Frame Relay, SONET) and circuit switching towards unified IP networks service providers can make a bundle selling new services.

Now the concept is beginning to catch on. This should translate to extra sales of the latest networking gear, despite Infonetic's earlier conclusion that overall telecoms equipment spending is actually falling.

Between 62 per cent to 81 per cent of the 21 service providers interviewed by Infonetics plan to increase their investments in IP/MPLS, broadband, and metro Ethernet technology over the next year. Infonetics estimates that the percentage of survey respondents doing some form of data network convergence over IP or IP/MPLS will rise from 62 per cent now to 86 per cent in 2004.

Analysts from Infonetics 21 service providers in North America, Europe, and Asia Pacific in compiling its study, prosaically titled Service Provider Plans for IP, MPLS, and ATM Networks, North America and Europe 2003. ®

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