Cisco’s Strategic Embrace of IMS Will Not Include Development of Core IMS Functions

| Oct 27, 2009 | IP Services Infrastructure | Competitive Intelligence Report

| Analyst: Joe McGarvey

Current Perspective: Slightly Positive
Vendor Importance: High
Market Impact: Moderate

Event Summary

October 26, 2009 – Though briefings with analysts, Cisco has confirmed that its future IMS strategy does not include the organic development of core IMS functionality, such as S-CSCF of HSS components of the 3GPP specification. Acknowledging that it would be difficult to compete with telecommunications switching giants in the session control portion of the IMS infrastructure, Cisco will instead pair its access, application, QoS and policy control technology with session control provided by its partners.

Analytical Summary

• Current Perspective: Slightly positive on Cisco’s confirmation that its pursuit of the carrier VoIP and multimedia market will not include the development of core IMS components, such as serving-call session control (S-CSCF) or home subscriber server (HSS) modules. The strategic move is a wise one in that the window for competing head-to-head against the longtime suppliers of telecommunications switching gear, such as Alcatel-Lucent, Ericsson, Huawei and Nokia Siemens Networks (NSN), for the IMS-based core of telecommunications networks is now closed – if it were ever open. Cisco correctly recognizes that its best opportunity to participate in the IP transformation of telecommunications service delivery network is to focus on the IMS-based solutions it has developed for session management and application logic, and to ensure those solutions are interoperable with core IMS equipment from third parties. Cisco’s solidification of its decision not to pursue the core IMS market suffers from the company’s indecision on this topic in the past. In the past couple of years Cisco has discontinued core IMS equipment it acquired and, more recently, discontinued internal development efforts. While Cisco’s decision to partner with core IMS equipment makers rather than develop its own technology is the correct one, the company’s positioning would carry greater authority had it not pursued building core IMS technology so recently in the past.

• Vendor Importance: High to Cisco, which is finally laying out a definitive plan describing how it plans to participate in the IMS marketplace. In addition to dispelling any lingering confusion over Cisco’s place in the IMS ecosystem, the solidification of its IMS strategy will help to counter industry perception that the company is anti-IMS. Though the company has always taken a public stance in support of IMS, while recognizing that it was one of several technologies and protocols governing the transmission of IP-based services, Cisco’s neutral, or agnostic, positioning of IMS created among some observers the impression that the company was in the camp of those positioning IMS as an unnecessary overlay that would impose artificial constraints beneficial only to telecommunications operators. With the disclosure of its IMS strategy, Cisco – similar to all equipment makers – is reinforcing the fact that it will support any and all architectures and technologies that are embraced by the service provider community.

• Market Impact: Low to moderate on the overall IMS equipment supplier sector of the market, as Cisco’s declaration of its IMS strategy going forward will neither surprise nor alarm makers of core IMS equipment. Competitors in the North American cable market, where Cisco has made the strongest play as a session control provider with its softswitch product, will benefit slightly from not having to compete with Cisco for IMS-related session control deployments in the future. It is likely that most of the competitors in this portion of the network will look to intensify efforts to provide a bridge to IMS-based session control in environments now controlled by Cisco’s BTS 10200 softswitch. Though Cisco will continue to develop its BTS platform, operators looking to move to IMS-based session control will need to augment the BTS-based deployment with third-party session control equipment.

CLIENTS ONLY

Current Perspective

Competitive Positives and Concerns

Recommended Vendor Actions

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Recommended Competitor Actions

• Alcatel-Lucent should closely monitor opportunities for IMS-based VoIP deployments among Tier 2/3 operators around the world. As these opportunities become more frequent and potentially more lucrative, Alcatel-Lucent should evaluate the potential to target its integrated IMS solution – the 5060 IP Call Server (IPC) – at this portion of the market.

• Comverse needs to continue to focus its IMS-based portfolio on opportunities among mobile operators. The company needs to be one of the first network equipment vendors to tap into the nascent IP Centrex market with mobile operators by leveraging the company’s penetration into that market with its messaging, billing and BSS/OSS products.

• Huawei needs to continue to subject its IMS portfolio to interoperability testing and exercises, such as the recently conducted ETSI IMS Plugfest. Through participation in global interoperability events, Huawei will make progress in demonstrating that its IMS portfolio is compatible and interoperable with products from major Western network equipment makers and thus a serviceable alternative for Western carriers.

• Ericsson should continue to distinguish its IMS offering from competitive offerings by promoting the Multimedia Telephony (MMTel) standard as the company’s universal subscriber feature set – for mobile and fixed VoIP deployments. By promoting the MMTel feature set as the voice/conferencing companion to its Rich Communications Suite (RCS) offering, Ericsson can further establish MMTel as a universal standard.

• Metaswitch needs to make a definitive decision regarding future support of internally developed core IMS components, such as the S-CSCF and HSS. Though the company is wisely focusing on application-layer technology to attract Tier 1 operators to the Metaswitch platform, the company needs to announce a migration path to IMS-based session control for its sizeable installed base publicly.

• NSN needs to flesh out its “The Network is One” vision by clearly defining how its IMS portfolio fits into this overarching strategy. The company also needs to emphasize how its IMS portfolio relates to other strategic assets within the company, such as its Service Delivery Framework (SDF) and subscriber data management (SDM) portfolio.

Recommended End User / Customer Actions

• Existing owners of Cisco’s Class 5 softswitch need to work closely with Cisco to ensure that the company provides investment protection for the platform as operators migrate toward an IMS-based architecture. Even though Cisco will not be supplying the IMS-based session control, operators will need to leverage as much of the BTS functionality as possible, such as its feature set and media gateway control function.

• Operators should strive for IMS-based equipment interoperability in order to build a best-of-breed service delivery system and encourage competitive pricing. At the same time, operators should not be dismissive of value-added benefits associated with single-vendor solutions that involve more than one layer of the IMS architecture, particularly the synergies between products in the session control and application layers of the network.

• Operators should closely monitor Cisco’s pending purchase of Starent. Operators should require Cisco to provide detailed information about the manner in which the acquisition of Starent’s core IMS technology will impact – or not impact – Cisco’s current strategy to partner with third-party core IMS makers to provide added value to its partners’ core IMS offerings.

CLIENTS ONLY

Current Perspective

Competitive Positives and Concerns

Recommended Vendor Actions

| Client access - Full report in IP Services Infrastructure | More information

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