IMS Outlook Mar06 PDF

Outlook
March 2006
IMS impact on OSS
OSS Observer
PO Box 1319
Sugar Grove, IL 60554
Tel: +1.630.466.9223
IMS WILL DRIVE THE NEED FOR MULTISERVICE OSS APPLICATIONS IN ALL FUNCTIONAL AREAS
By Peter Mottishaw
Executive summary
CONTENTS
n 2005 the first commercial IMS services became available. There

are approximately 50 CSPs who have purchased IMS equipment
and these will provide commercial service in 2006. Europe is ahead of
North America and Asia-Pacific in terms of IMS spending, but all three
regions will see significant IMS spending in 2006. Mobile services such
as video sharing have been the early drivers for equipment spending.
Fixed services such as IP Centrex and IP Telephony are becoming
more significant. Converged services using dual mode handsets will
also drive IMS spending in 2007.
Executive summary, p1
Market forecast, p2
IMS defined, p3
Market drivers, p5
Business environment, p8
OSS requirements, p13
IMS solution suppliers, p18
Market definition, p24
We forecast that the OSS spending to support IMS will grow from $30 million in
2006 to $500 million in 2011 at a CAGR of 72% (figure 1). Real-time convergent
charging will drive the early growth. The early adopters of IMS will achieve large
scale, multi-service deployments in 2007. The need to control operational costs,
rapidly deliver new services and provide a reliable customer experience will drive
spending on horizontal, multi-service OSS solutions in 2007 and beyond.
Figure 1: OSS forecast, p1
Figure 1: Commercial OSS spending forecast for IMS services, 2005 - 2011
Figure 3: IMS architecture,

p4
$500
Figure 5: OSS market

segments, p26
$ (millions)
$400
Table 1: Commercial IMS

services, p9
$300
Table 2: IMS contracts, p12
$200
Table 3: IMS equipment

providers, p18
$100
Total OSS spending
Figure 2: IMS equipment

forecast, p2
Figure 4: IMS architecture 3GPP and TISPAN, p25
$600
$-
Recommendations, p27
2006
2007
2008
2009
2010
2011
$30
$140
$280
$360
$420
$500
Source: OSS Observer
Table 4: Ericsson, p20

Table 5: Siemens, p21
Table 6: Lucent, p22
Table 7: Nokia, p22
Table 8: Alcatel, p23
2006 OSS Observer LLC. All rights reserved worldwide
IMS Outlook: 2006-2011
Market Forecast
OSS Observer forecasts that the IMS equipment market will grow from
$470 million in 2006 to $4.96 billion in 2011 at a CAGR of 60% (figure 2).
Figure 2: IMS Equipment forecast, 2006-2011
$6,000
$5,000
$ (millions)
$4,000
$3,000
$2,000
$1,000
$-
2006
2007
2008
2009
2010
2011
Application driven spend
$130
$480
$860
$1,250 $1,750 $2,530
Infrastructure spending
$340
$700
$990
$1,490 $2,110 $2,430
Source OSS Observer
The forecast includes all the revenue NEMs generate from supplying CSPs with IMS capable
equipment. The infrastructure spending includes the CSCF (serving, proxy and
interrogating) and HSS products. The application driven spending includes the application
servers and media resource functions. The forecast excludes the system integration and
other services required to deliver a solution. It also excludes IMS clients, client software
and the soft-switches and media gateways used to integrate with legacy circuit-switched
services.
EMEA is currently the leading region in terms of IMS deployments. Most deployments are
with mobile operators and support specific services such as video showing. EMEA mobile
will grow quickly in the next 18 months as push-to-talk over cellular (PoC) deployments are
upgraded to IMS. The major European operators; such as Telecom Italia, Telefonica and
France Telecom; are bringing their mobile and fixed operations closer together. They will
make strategic investments in IMS as the common control layer for fixed and mobile
networks. As a result, deployment of a common core IMS will become the most significant
segment in the next few years. In the fixed area there will be rapid growth in IMS spending
as consumer IP telephony and business IP Centrex services are migrated to an IMS control
layer. Telefonica has already done this for their IP Centrex service and BT has recently
made the transition with their consumer BT Communicator service.
North America has seen some major commitments to IMS from AT&T, Verizon,
Cingular, BellSouth and Sprint. With the exception of Sprint this has not led to
significant spending. To enable new services tier 1 operators in the US will start to
2006 OSS Observer LTD. All rights reserved worldwide
transition their residential VoIP offerings to IMS. They will also deploy new mobile services
with IMS in the coming 18 months. They will be slower than the Europeans to invest in a
common IMS core across fixed and mobile networks with the exception of Sprint who has
already moved forward in that direction.
Asia-Pacific has had a number of IMS deployments in mobile networks to support video
showing and push-to-talk. This trend will continue with strong growth in mobile IMS
spending over the next two years. Migration to a common control layer for fixed and
mobile networks will become the main driver for IMS deployment in the near future.
Commercial OSS forecast for IMS equipment and related

services
OSS Observer forecasts that the OSS spending to support IMS will grow from $30 million
in 2006 to $500 million in 2011 at a CAGR of 72% (figure 1). Included are all the billing,
customer care, service assurance and service fulfillment solutions that are deployed
specifically to support IMS. OSS spending will become significant in 2007 when the early
adopters of IMS start to move to multi-service, multi-vendor, large-scale deployments and
can no longer efficiently manage with the NMS and custom solutions supplied by the
equipment provider. As deployments start to scale up and automation becomes critical
billing will be the first area of OSS investment, followed by service fulfillment. Unless CSPs
experience major quality of service issues in the early deployments we expect the timing of
investment in service assurance to be slightly behind these.
IMS Defined
The IMS vision is of an infrastructure that supports services built from any
combination of multimedia components; voice, video, messaging, data,
content and gaming. It will enable rapid deployment of new services that
combine these components in new ways and it will enable third parties to
provide these services. The end user will have a common experience and
common data across all devices; mobile handset, PDA, PC, IP TV. All of this
will be delivered across a common IP core network and support any
available access network; DSL, cable, mobile, WLAN, enterprise data
services, WiMAX.
The IP multimedia subsystem (IMS) originated as part of the third generation partnership
project (3GPP) standards. It was initially introduced with release 5 of the 3GPP standards
completed in 2002. It provides an IP based control layer to support IP multimedia sessions
between end-users. New services can be delivered more easily because IMS enables
application servers and media resource functions to participate in the multimedia sessions.
In order to fulfill the IMS vision IMS standards are being developed to ensure access
independence, so that the same service control infrastructure can be used across mobile,
wireless LAN and broadband access networks. More background on this is provided in the
market definition section.
IMS services
IMS supports session based multimedia services with a common experience and shared data
across the different access technologies.
Examples of IMS based services:
Presence - real-time status and current preferred method of communication for

contacts.
"See what I see" - during a voice call initiate a video stream from the camera on
your handset to the other person.
Push to talk - push a button to talk to everyone in a given group.
Network phone book - contact information is available from any IMS client.
Instant messaging real-time text based interaction
Interactive games - real-time peer-to-peer gaming.
IP Centrex services business VoIP services
IP Telephony consumer VoIP services
IMS will be integrated with other services such as IPTV to support presence, voice
conferencing, instant messaging and other services.
The services enabled by IMS are not fundamentally new, but IMS provides the infrastructure
to tie the services together and to combine different services within the same session. Many
services will be based around the same presence service and use common network phone
book capabilities. The same user interface will provide the presence, status and availability
of contacts and enable push to talk, instant message, text message, video call, conference
call and services not currently envisaged. A major attraction of IMS is that it will provide the
same user profile and services regardless of access technology or client technology.
IMS architecture and products

A more detailed description is provided in the market definition section.
Figure 3: IMS Architecture and OSS functions
Service
ServiceDelivery
DeliveryPlatform
Platform
Service
Layer
Presence, 3rd Party Access, Messaging, Location,

Customer Self Care
Application Server
Order Management
HSS
IMS Control
Layer
Service Quality
CSCF
Inventory
Transport
Layer
IP Core
MGCF+MGW
Activation
Real time charging
Access
Layer
UMTS
CDMA
WLAN
xDSL
IMS Client
Layer
Source OSS Observer
Cable
Network Assurance
Device Management
The principle components of the IMS architecture shown in figure 3 are:
HSS - home subscribers server - stores user profiles and service related data.
CSCF - call session control function - processes and routes SIP signaling messages
AS - application server - processes SIP messages and executes the service logic for
specific services such as presence, push-to-talk or voice conferencing.
SDP - service delivery platform - not strictly part of IMS, but enables rapid creation
of new services that use IMS.
Client - IMS clients communicate via the CSCF using SIP signaling.
MGW and MGCF inter-work SIP signaling and voice over IP to legacy circuit
switched networks.
Market drivers
Most major CSPs are investigating or trialing IMS. A few have launched
commercial services based on IMS. Investment in IMS is a strategic business
decision justified by deployment of multiple services over multiple years.
Investments in OSS will lag the investment in IMS. The second wave of
larger scale, multiple service IMS deployments will drive major OSS
investments starting in 2007.
We see seven important drivers and four inhibitors for growth in investment in IMS
equipment and infrastructure.
Market drivers
Enable new multimedia services

Rapid, low-cost deployment of new services
Fixed mobile convergence
Common IMS core
Differentiate from "best efforts" service providers
All IP network
Third-party services
Market inhibitors
Competition from bit pipe operators and best efforts services

IMS client availability and usability
Compelling IMS applications
Interoperability issues
Drivers
Enable new multimedia services
CSPs are looking for new revenue streams and ways to attract and retain customers.
Multimedia services that combine voice, video, data, content and interactive services in new
ways are one way to achieve this. TMN in Portugal, for example, has carefully targeted
their IMS based video sharing at families. They have bundled multiple handsets with
attractive voice and video tariffs for communication within the family. This has improved
customer retention while providing additional revenue. Opportunities like this will be major
drivers for investment in IMS.
Rapid, low-cost deployment of new services

Historically it has been slow and expensive to introduce new services. As a result, CSPs
have been reluctant to test the market with unproven services. IMS in combination with
next-generation SDPs significantly reduce the cost of introducing new services and the time
to market. This will reduce the CSPs risks in experimenting with innovative new services
and lead to new revenue sources and will be one of the strategic drivers for IMS
investment.

The fixed mobile substitution trend, where some customers use their mobile handset for all
voice calls, is a threat to fixed line operators. It is also an indication that customers would
prefer a single personalized wireless communications device. Network operators are
responding to this with dual mode handsets and services that operate on both WiFi and
cellular networks. This can also address problems with in-building coverage and has the
potential to make use of cheaper, higher bandwidth WiFi coverage for both voice and data.
Unlicensed mobile access (UMA) is one approach to offering voice services on dual mode
handsets. It makes use of the existing call control capabilities of the GSM network. An
alternative is to use IMS to provide a common call and session control capability on both
the fixed and mobile networks. This is particularly attractive to fixed line operators trying
to reduce the rate of fixed mobile substitution. The advantage over UMA is the ability to
provide multimedia services in addition to voice. The opportunity to improve customer
retention and increase ARPU by offering integrated fixed/mobile service will be a major
driver for IMS investment.
Common IMS core

Many CSPs own both fixed and mobile networks and would like to reduce costs by sharing
infrastructure between the networks. There will be an increased trend towards a common
core IP network, with fixed and mobile providing a range of access options. This will
reduce operational costs and the cost of developing new services. IMS is the ideal "access
agnostic" IP control layer for such a converged network. The opportunity to save costs will
drive IMS investment.
A related driver is standardization of the control layer for Tier 1 CSPs who own multiple
operating companies. Operators like Vodafone will use IMS to reduce costs by moving to
a single IMS control layer across all operating companies. It also increases their ability to
deliver consistent services and branding across operating companies. A key capability of IMS
is its independence from the access technology.
Differentiate from "best efforts" service providers

Many of the services envisaged for IMS can be supplied over a best efforts IP connection.
The Skype service from eBay or the Yahoo! Messenger with the voice service provide
presence with instant messaging, voice calling, voice conferencing and connection with the
legacy PSTN network. The Skype client is available on different devices; PCs, Microsoft
Windows Mobile devices. Many Skype services are free and represent a major threat to
CSPs revenues. IMS enables differentiation between these types of services by providing
explicit control over the quality of service of a multimedia session. It enables a standardsbased environment for service creation and it supports standards-based flexible billing.
We expect low-cost, best efforts services such as Skype, Yahoo messenger, MSN
messenger, AOL messenger and others will be successful, but IMS will enable CSPs to
deliver a better customer experience and charge a significant premium. Some of the
Instant Messenger companies will choose to cooperate with CSPs and deliver premium
versions of their services using IMS technology and leverage their customer base and their
brand name. Yahoo for example has already taken this approach with BT in the UK.
All IP network
In fixed and mobile networks, CSPs can significantly reduce costs by transitioning to IP
networks. In the fixed network, residential broadband and business data services are
increasingly standardized on IP transport. CSPs are transitioning out their voice networks
going from circuit switched to IP technology. Mobile operators have introduced IP
networks to support data services like GPRS and are rapidly moving to IP core networks
with the introduction of mobile soft-switches. IMS is the leading standards-based control
layer to support real-time session based services such as voice over IP, video sharing and
presence in a carrier IP environment. The transition to IP will be a major driver for IMS
investment.
Standardization
CSPs require interoperation of services to maximize their market opportunity. In a mobile
environment, services must work when connected to competitors networks. This requires
a certain level of standardization of the basic service capabilities. IMS provides this level of
standardization in an IP environment.
Third-party services
IMS in combination with next-generation SDPs enable CSPs to open their network to third
parties to offer innovative new services. This will create new revenue streams and improve
customer retention as third parties address the needs of specific market niches.
Inhibitors
Competition from bit pipe operators and "best effort" services
CSPs providing IMS based applications are in direct competition with best efforts or over
the top services which use the fixed or mobile IP network as a bit pipe. Google, Yahoo,
eBay (Skype) and MSN are well positioned to compete with their large installed base of IM
and VoIP customers. CSPs must deliver applications that use the unique IMS capabilities to
provide compelling value beyond what is available from "best efforts" services. This means
taking advantage of quality of service capabilities, interoperability and standardization to
differentiate IMS based applications from unmanaged Internet-based applications. Bundling
and innovative pricing can also help. The challenge of using IMS to deliver clear
differentiation from best effort services is one of the major risks, especially in the fixed
market where the bandwidth to support VoIP is cheap and widely available.
In the U.S., companies like Google have been supporting the "net neutrality" movement in
recognition of the opportunity for best efforts services. If net neutrality is adopted by
regulators it may stop CSPs from charging a premium for higher quality service and will
dramatically reduce the investment in IMS. CSPs will no longer have a business case to
justify the investment.
IMS client availability and usability

IMS client software requires certain capabilities from the platform on which it runs; for
example a Java capable phone with IP connectivity. A given IMS application may require
additional capabilities. In the example of mobile video sharing during a voice-call the handset
requires hands-free capability in addition to a video

pricing of handsets that meet all these requirements
video sharing service. Another client related issue
manage the client software. In the mobile market
limitation on the overall market size.
camera. The market penetration and

will limit the available market for the
is the need to remotely install and
client related issues are the biggest
Compelling IMS applications

IMS is not dependent on a single killer application for success, but does depend on the
success of a number of unproven or risky application/service models. In the mobile market,
applications such as presence, push-to-talk and push-to-share (e.g. video) contribute to the
business case for an IMS infrastructure. In the fixed market applications such as presence,
IPTV, IP Telephony and IP Centrex support the IMS business case. If a number of these
services fail to gain market acceptance, investment in IMS infrastructure will be slowed.
Interoperability issues
The IMS services offered by CSPs must interoperate and continue to function when
roaming to another network. Recent experience with multimedia messaging services has
shown how interoperability issues can slow the up take of new services. IMS vendors must
ensure multi-vendor interoperability between handsets and networks, and between
networks to avoid this experience with IMS based applications. These issues are being
addressed by interoperability testing events organized by the GSM Association. In the fixed
and mobile markets, interoperability issues are likely to slow the progression of IMS based
services.
Business Environment
IMS is still in the early market phase. There have been approximately 50
significant contracts signed by CSPs for IMS equipment. Approximately 10 of
these CSPs are offering commercial IMS based services. Video sharing
between mobile handsets is the leading service with deployments by
Telecom Italia, TMN in Portugal and CSL in Hong Kong. An additional 100
CSPs are conducting IMS trials for a range of mobile, fixed and converged
services.
There are a small number of commercial services available today that are delivered using a
true IMS infrastructure. Some examples are:
Table 1: Examples of commercially available IMS based services
CSP
BT, UK
CSL, Hong Kong
NTT DoCoMo, Japan
TMN, Portugal
Telefonica, Spain
Telecom Italia Mobile
Service offering
BT communicator service
Video sharing service
PushTalk service
Video sharing service
IP Centrex service
"Turbo Call" video sharing service
Vendors
Alcatel, ACME Packet
Nokia
NEC
Nokia
Ericsson, Hotsip
Nokia
Source: OSS Observer, Company briefings
IMS deployments are mainly single vendor small-scale, projects. As a result, the OSS
requirements can be met by the NMS solutions provided by the equipment vendor.
IMS precursors
IMS is a technology that provides the control layer for session based multimedia services.
Historically voice calls over a circuit switched network have been the only session based
multimedia service. The SS7 network provided the control layer. The majority of mobile
and fixed voice calls are controlled by the SS7 signaling protocol. Over the last 10 years,
voice over IP technologies have been developed with their own control protocols. SIP
provides the control layer in voice over IP networks in a way similar to SS7 in circuit
switched networks. SIP is a flexible signaling protocol that can control a wide range of IP
based services such as instant messaging, presence and video calling. 3GPP has adopted SIP
as the main signaling protocol for IMS.
The importance of SIP is that it is already widely deployed by CSPs for services like IP
Telephony, IP Centrex and PoC (push to talk over cellular). The current state of
deployment of these services and other IP based services are important in understanding
the IMS business environment. The most important precursors of IMS are:
Push to talk over cellular

Voice over IP in the fixed network
Mobile soft-switches
fixed mobile convergence
SDP
Real-time charging
OSA/Parlay
IP quality of service
Date
4Q 2005
November 2005
October 2005
July 2005
April 2005
February 2005
Each of these introduces network elements and/or services that have a direct upgrade path
to IMS compliance or directly enable IMS services. The following paragraphs summarize the
current state of deployment for each IMS precursor.
Push to talk over cellular

Push to talk is a mobile service where groups of people are constantly available to each
other at the push of a handset button. Only one person can speak at a time but everyone in
the group hears them . Nextel developed a very successful push to talk service in the 1990s
based on Motorola iDEN technology. Initially started as a business service it has also been
successful with consumers. The Open Mobile Alliance (OMA) has developed standards
known as "push-to-talk over cellular" (PoC) to deliver push-to-talk services over the GSM
family of technologies. The first release was finalized in June 2005. It uses SIP signaling and
the voice is delivered over IP. Some performance problems have been experienced, but
these can be dealt with by appropriate configuration of the GPRS network. There are more
than 50 handset models available supporting OMA PoC and more than 33 commercial
OMA PoC services are now in operation. Although over-hyped in the last couple of years
PoC will be a successful service.
OMA PoC does not require IMS, but is targeted at using the IMS infrastructure that will
become available with 3GPP Release 5. In the past few months, a number of OMA PoC
deployments have been upgraded to IMS compliance. This trend will continue. OMA PoC is
important to IMS because it drives the introduction of SIP based application servers and
clients into the mobile network. The presence and group management servers required for
PoC can be reused by other IMS based applications. This reduces the incremental
investment to full IMS deployment.
Voice over IP in the fixed network

VoIP technology has been around for more than a decade and is fairly mature. VoIP based
services are well established for consumers and enterprise customers. Tier 1 CSPs such as
Verizon, AT&T and BT have offered voice over IP services for some time and are
investing in infrastructure to accelerate the transition to voice over IP. Innovative new
entrants such as Skype and Vonage have been critical in pushing the CSPs in this
direction. Companies like Cisco and Avaya have rapidly increased the penetration of IP
phones and IP PBX.
There is a number of competing industry and proprietary standards for the control layer in
these deployments, but SIP is now the market leader. This is very positive for IMS because
it is based on SIP, and provides the additional capabilities that CSPs require in terms of
quality of service control, billing and standardization. Most SIP vendors who are focused on
the CSPs will offer an upgrade path to full IMS capability.
Mobile softswitches
Most mobile CSPs are committed to moving to 3GPP Release 4 and many are close to full
deployment. This will introduce an all IP core with mobile soft-switches and media gateways
providing the interface between the IP network and the circuit switched network for voice
services. This is an important step towards IMS deployment. IMS can provide the control
layer within the IP core even if the voice and video services are delivered to the handset
using circuit switched connections.

Fixed mobile convergence enables a single handset to be used both on the wide area
cellular network (GSM or CDMA for example) and using a local wireless connection (WiFi
or Bluetooth) when in the home or office. The unlicensed mobile access (UMA ) initiative is
driving one approach to delivering this. It has support from BT, Cingular, T-Mobile, O2
10
and Rogers Wireless. BT has deployed its Fusion service based on this technology and is
claiming rapid uptake.
The success of UMA is important for IMS in establishing and promoting the "dual mode"
handset and service. UMA does not use IMS technology and in the short-term provides an
advantage over IMS based solutions by supporting handoff between the wide area and local
area wireless technologies. Because of its support for other services, many CSPs will
choose to go directly to IMS based solutions if UMA is successful,.
SDP
Service delivery platforms enable the creation and execution of services that combine
content, data, voice and video. Many CSPs have deployed a variety of service delivery
platforms over the last few years. Most mobile operators deliver content and downloads
from a service delivery platform. A number of CSPs use SDPs to deliver new voice services
using Parlay interfaces to existing equipment.
SDP deployment is important to IMS because IMS provides an ideal control layer for the
SDP to deliver session based multimedia services. In the IMS architecture, the SDP looks
like an application server and current deployments of SDPs can be seen as a precursor to
deployment of IMS application servers. Most SDP providers support or plan to support the
IMS ISC interface.
Real-time convergent charging

Real-time convergent charging is the capability to maintain a single account balance across
multiple services in real-time. Prepaid mobile, based on IN real-time charging, continues to
grow rapidly. Due to the growth in the number of mobile services, some operators have
started to deploy convergent real-time charging to enable prepaid accounts across all
services.
Real-time convergent charging is important for IMS because it is one of the key benefits
beyond the basic SIP architecture. Companies like Telcordia already provide their real-time
convergent charging solutions on IMS compliant platforms. This effectively introduces IMS
components into the network and strengthens the case for future IMS deployment.
OSA/Parlay
The OSA/Parlay standards support the development of call control applications in a
standard IT software development environment. The Parlay X standard provides a Web
services Interface for application developers which requires very little knowledge of the call
control layer of the network. Parlay gateways have been deployed by a number of CSPs to
support both internal development and provide secure access to third-party developers.
OSA/Parlay deployments are important to IMS because OSA/Parlay is the standard adopted
within IMS to support third-party access to the session control capability.
IP quality of service
IP quality of service is a set of mechanisms that enable an IP network to be configured so
that different IP packets can be delivered with different quality of service levels. This
technology has been widely deployed in carrier IP networks. Nearly all MPLS VPN services
are offered with multiple levels of quality of service. This is essential to enterprises who
want to deliver voice over IP and data over the same VPN.
Because it is one of the key mechanisms IMS uses to differentiate itself from a best effort
SIP based service the maturity and widespread use of this technology is important to IMS.
11
12
IMS trials and contracts

IMS equipment providers claim more than 150 IMS customer engagements. Approximately
one third of these are commercial contracts and the remainder are trials. The leading NEMs
are Ericsson, Siemens, Lucent, Nokia and Alcatel. Mobile deployments account for
about half of the customer engagements, with the remainder evenly split between fixed
networks and fixed/mobile convergence applications. EMEA is the leading region with about
half the customer engagements. Asia-Pacific is next with a quarter of customer engagements
and North America is close behind. CALA makes up the rest.
Publicly announced customer engagements are shown in table 2.
Table 2: Publicly announced IMS trials and contracts, January 2005 - February 2006
Date
02-Feb-05
14-Feb-05
14-Feb-05
14-Feb-05
15-Feb-05
15-Feb-05
15-Feb-05
23-Feb-05
07-Apr-05
07-Jun-05
07-Jun-05
08-Jun-05
13-Jun-05
14-Jun-05
14-Jun-05
28-Jun-05
05-Jul-05
18-Jul-05
22-Jul-05
27-Jul-05
24-Aug-05
26-Aug-05
07-Sep-05
08-Sep-05
05-Oct-05
13-Oct-05
17-Oct-05
18-Oct-05
20-Oct-05
25-Oct-05
26-Oct-05
07-Nov-05
Contract
TA Orange awards Alcatel a USD 133 million contract to expand and upgrade its mobile network in Thailand
Merging fixed and mobile networks: France Telecom and Siemens test Fixed Mobile Convergence solutions
based on IMS Joint press release
Ericsson selected by Telecom Italia Mobile (TIM) to supply IMS based combinational services
TIM and Nokia to commercialize Video Sharing in Italy on the Nokia 6680
Ericsson and TeliaSonera to trial IMS for converged multimedia services
Nokia and TeliaSonera agree to cooperate in trials for developing the networks of tomorrow
T-Mobile USA selects Alcatel to enhance its national core network
Belgacom Chooses Italtel and Cisco Systems to Develop Its IP Based Multimedia Services
Ericsson provides Telefnica with IMS for IP telephony and IP Centrex services
CMC Telecom Selects Lucent Technologies and Dynavar Networking to Deploy Complete Next-Gen TDM
and VoIP Solution
Nokia supplies advanced Fixed Mobile Convergence solutions to Saunalahti in Finland
Ericsson provides TDC with IMS for telephony and IP Centrex Services
Nokia to expand Elisas networks, bring high data speeds to 3G
Lucent Technologies and Japans eAccess Complete Successful HSDPA Calls as Part of 3G Network Trial
Telkomsel trials 3G with Nokia in Indonesia
Nokia brings Presence to TeliaSonera Finland
Lucent Technologies Awarded PHS Network Expansion Contracts by Chinas Gansu Telecom and Shandong
Netcom
Portugal's TMN chooses Nokia for Video Sharing
Siemens achieves market entry for convergent network technology in China: Chinese consortium orders IMS
solution for multimedia applications
Alcatel selected for Euro 17 million VoIP solution for PTK in Kosovo
Sky Link and Lucent Technologies Enhance CDMA450 Network in Moscow with CDMA2000 1xEV-DO
Technology and Lay Foundation for IMS-based Multimedia Services
Ericsson and BB Mobile show IMS service handover between 3G and WLAN
Ericsson's IMS selected by Commander in Australia for DSLAM initiative and deployment of new multimedia
services
Lucent Technologies Migrates Telefnica Empresas Services
Nokia to trial Fixed Mobile Convergence solutions with Telemar Oi in Brazil
Ericsson and Rogers Communications Inc. to trial 3G/HSDPA and IMS platform in Canada
Cingular Wireless selects Lucent Technologies IMS-Based Solution for Evolution to Next-Generation Services
SBC Communications Selects Lucent Technologies Multimedia Platform to Enable Anytime, Anywhere Access
to Consumer IP Services
O2, Manx Telecom and Lucent Technologies to Launch First Commercial 3G
Alcatel's SIP solution puts BT at the forefront of service innovation
China Netcom selects Alcatel for nationwide next generation network evolution
CSL launches Asia's first commercial video sharing service with Nokia IMS
08-Nov-05
30-Nov-05
30-Nov-05
05-Dec-05
14-Dec-05
06-Jan-06
12-Jan-06
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13
BellSouth Selects Lucent Technologies Next-Generation Solution to Enable a Range of Advanced Consumer
IP Services
Nokia and PLDT cooperate in Fixed-Mobile Convergence solutions in the Philippines
Ericsson Mobile Softswitch, IMS and UMA tapped for SunCom Wireless' next generation network
Nokia powers Eurotel's WCDMA 3G network in the Czech Republic
Verizon Tests Nortel IMS Solution
NEC's IMS Platform Contributes to Realization of NTT DoCoMo's New PushTalk Service
Nokia to supply Push to Talk to Fujian MCC in China
Lucent Technologies Provides Brasil Telecom with IMS Elements for VoIP Services
Alcatel enables mobile Next Generation Network services in Russia
Lucent Technologies Supplies vistream with Advanced Network and Real-Time Rating and Charging Platform
in Germany
Ericsson selected by Vodafone Group as a supplier of IP Multimedia Subsystem with
Vodafone awards global contract to Nokia for IMS
Ericsson and Telenor to test convergent and seamless IMS Services
Source: Company reports
OSS requirements and implications

The vision for IMS is of an infrastructure that supports rapid low-cost
creation of new IP multimedia services from any combination of voice, video
and data. The same service will be available across all access technologies;
3G mobile, xDSL, cable, WLAN, WiMAX. The end user experience will be
of instant gratification with a wide choice of services. Many services will
combine IP multimedia capabilities in new ways. OSS solutions must support
this vision.
This vision has certain implications for all OSS segments. The deployment of a common
control layer across all access technologies , which supports many different types of
services, will drive CSPs towards multi-service, multi-technology OSS solutions in each
functional area. Vertical solutions developed for a specific service or technology must
evolve towards horizontal solutions supporting multiple services and multiple technologies.
A service fulfillment solution for DSL, for example, must evolve to support converged
services.
Rapid low-cost service creation is a critical part of the IMS business case. The implication
for OSS solutions is that they have the flexibility to support new services. To achieve rapid
low-cost creation of the OSS capability will require integration of some OSS functions with
the CSPs service creation process. This will require close cooperation between OSS
solution providers and SDP providers.
With the rapid creation of new services and the introduction of IMS comes the
proliferation of IT platforms in the CSPs network. These will be in the form of application
servers, service delivery platforms and media resource functions. The implication for OSS
solution providers is the need to manage these IT platforms in addition to the network
components.
IMS deployments are at an early stage, are generally driven by a single service and largely
single vendor. As a consequence the equipment provider meets the OSS requirements. This
will change as IMS deployments become multi-service and multi-vendor starting in 2007.
OSS vendors who are strong players in the IMS precursor services such as IP Centrex,
consumer IP telephony and PoC will be well positioned to benefit. In the area of real-time
convergent charging, we are already seeing IMS driven deals. Telcordia in particular has
benefited.
Billing
The CSP must be able to offer innovative pricing and bundling of IMS services. Historically
billing systems have been postpaid and based on offline processing of CDRs. Recently
mobile prepaid services have been provided using dedicated real-time IN based charging.
The IMS billing system must converge both of these models while supporting the creation
and delivery of new services.
The principle requirements for an IMS billing system will be:
Convergent billing system

Real-time convergent charging and rating
Customer visibility of real-time status of account and services
Rapid low-cost service creation
High availability
Partner settlement
Convergent billing system

A convergent billing system is one that is not tied to a particular service or network
technology. IMS will provide a common control layer across any access technology; mobile,
broadband, wireless LAN, cable and enterprise data services. This is essential to the IMS
vision of providing the same user experience regardless of access technology. There has
been a general trend towards convergent billing systems; IMS will accelerate this trend
beginning in 2007. The leading billing vendors, Amdocs, Convergys, Comverse, Portal,
CGI/AMS, Intec and LHS; are already addressing this need and are well positioned to
address the IMS opportunity.
Real-time convergent charging and rating

Real-time convergent charging is the ability to manage in real-time a single account balance
across all services available to a customer. This is central to the IMS vision of providing
innovative combinations of multimedia services and instant gratification for the customer.
Flexible real-time rating is the ability to support a range of approaches to pricing and
complex discounting schemes. Pricing should support the variety of IMS services and be
based on, for example, duration of service, amount of data transferred, number of
messages. Discounting schemes should support cross service discounts, for example
providing a free bundle of messages after a number of video sharing calls are completed.
The IMS standards provide the enablers to support real-time convergent charging and
rating. Open standards based on the diameter protocol will open the market segment to
OSS suppliers. IMS will be a driver in the replacement of the existing IN based real-time
charging systems that support mobile prepaid services. We are already seeing solutions
delivered in greenfield situations. IMS will start to drive replacement of IN based prepaid
systems in 2008 onwards.
Real-time convergent charging is a new opportunity addressed by a number of vendors.
Ericsson, Convergys, Openet and Telcordia have already won business in the segment.
All the major billing vendors and some of the NEMs will challenge them.
Customer visibility of account

Customer visibility of their account includes current balance, services used, services
ordered and any discounts applied. Providing a simple real-time view is essential to deal
14
with the potentially complex bundling and discounting envisaged for IMS based services.
This requirement is already being addressed by most of the major billing vendors.
Rapid low-cost service creation

Billing systems must support the IMS vision of rapid low-cost service creation. This will
require close integration between the service delivery platforms used by the CSP to create
new services and the billing system. This will be achieved by a partnership between the SDP
supplier and the billing vendor. Vendors such as Telcordia and Ericsson who provide
both the SDP and real-time convergent charging solutions are well positioned to integrate
service creation with billing.
Highly available system

Billing systems have traditionally operated as offline CDR processing systems. There were
strong requirements for maintaining the integrity of billing data, but this did not require
continuous high availability operation because CDRs could be reprocessed if a failure
occurred. IN based real-time charging was an exception, but the equipment supplier who
expects continuous high availability operation for all carrier grade products has generally
provided these. In IMS, architecture failure of the billing system can result in service being
denied customers. Therefore high availability is a critical requirement. NEMs will be well
positioned to supply the high availability components of the IMS billing system. Most will
partner with billing system vendors to provide an overall solution.
Partner settlement
One of the benefits of IMS will be to support CSPs in enabling third-party service providers
to deliver content and services over their network. Inter-carrier billing and MVNO type
requirements have driven the existing partners settlement solutions. IMS will require
greater flexibility in the services supported and much larger scale in the number of partners
and transactions supported.
Customer care
IMS will have most impact on OSS functions that are close to the network. Its effect on
customer care requirements will mainly be indirect. The increased rate of introduction of
new services and the increased number of services that IMS will facilitate is the most
important factor. It will put heavy emphasis on the need to control costs and meet
customer expectations by providing comprehensive customer self-service. In the initial IMS
deployments these self-service portals are often provided by the NEM, but as IMS
deployments become multivendor, multiservice and large-scale an independent customer
self-service solution will be essential IMS will have significant impact on spending in this area
in 2008. The leading customer interaction vendors; Genesys, Siebel, Amdocs, Avaya
and Vignette; are well positioned to take advantage of this.
Service assurance
IMS services are multimedia services delivered over an IP network. Historically the quality
of service choices available to the customer was limited. Circuit switched networks
provided a very high quality of service, the Internet provided the best efforts service and
cellular networks provided something in between. IP networks are now flexible and
configurable in the quality of service they provide. This creates challenges in delivering the
required quality of customer experience for IMS services. OSS service assurance solutions
are critical to meeting this challenge.
The specific service assurance requirements are;
15
Monitoring of IP multimedia customer experience

Rapid creation of service models
SLAs for third-party service and content providers
Assurance of the IMS control plane
Real-time performance monitoring
The following paragraphs provide more detail on these requirements.
Monitoring of IP multimedia customer experience

IMS uses IP quality of service mechanisms to provide the quality of service required for a
given multimedia session. However, the quality of customer experience can still be
impacted by network congestion, network faults, and configuration problems in the
network and on the client. The growth of IMS based services will be severely limited if CSPs
deliver poor or unpredictable customer quality of experience. CSPs will deploy IMS
customer experience monitoring solutions to identify and diagnose problems quickly.
One approach will be to deploy active test probes in the network to simulate typical
customer behavior and measure the quality of the customer experience directly. Active
probe systems from Agilent, Casabyte and Sigos are used extensively in mobile
networks. Brix provides a similar capability for VoIP networks. These solutions will be
upgraded to support IMS based services over the next two years.
A complimentary approach is to monitor customer experience directly from the IMS client.
This has the potential to measure the experience of actual customers, but has significant
issues of battery life, privacy and use of client resources. Handset manufacturers, NEMs and
ISVs are experimenting with this approach. We expect IMS solutions to be deployed in
2008.
Rapid creation of service models

Service management solutions enable CSPs to manage the service level provided for a
particular service or customer. The approach has been to build service models that capture
the dependencies for a particular service and then to correlate data from many sources to
infer the quality of service provided. In an IMS environment where new services are being
deployed it frequently becomes essential to generate the service models automatically. In
principle this can be achieved by integration of service management with the service
delivery platform.
The service management market is at an early stage and deployments so far have required a
high level of customization. We expect the solutions to mature over the next two years
and IMS will start to impact the market in 2007 and 2008. Telcordia and HP are
particularly well positioned with leading positions in service management and offering
service delivery platforms.
SLAs for third-party service and content providers

CSPs will use IMS to enable third-party service and content providers to deliver services
over their network. CSPs will offer SLAs in order to attract the best content and services.
This will be particularly important where the third party is paying for a higher level of
quality of service than best effort. Service assurance solutions will be required to monitor
the network performance and quality indicators required by the SLA. IMS will start to
impact purchases in this area in 2007.
16
Assurance of the IMS control plane

IMS effectively replaces the existing SS7 based control plane of the mobile and fixed circuit
switched networks with a SIP based control plane. Historically CSPs have invested heavily in
SS7 monitoring solutions from suppliers such as Agilent and Tektronix. These solutions
have enabled a range of applications such as SS7 network management, billing verification,
fraud detection, billing verification, business intelligence and traffic management. In the IMS
environment it would be possible to deploy a similar SIP monitoring solution. However, the
real-time charging capabilities envisaged for IMS will support some of the applications
previously provided by SS7 monitoring. In addition the NEMs will provide improved access
to real-time data reducing the need for dedicated monitoring hardware. As a result we
expect to see SIP monitoring systems deployed but not on the scale of SS7 monitoring
systems. Agilent and Tektronix will evolve their existing systems to meet this need.
Real-time performance monitoring

IMS enables the rapid deployment of new IP multimedia services. These are potentially
available to all customers as soon as they are deployed on an application server. Many
services will only find a niche market, but some will achieve mass-market penetration very
quickly. This will have unpredictable impact on traffic patterns and volumes on the IP
network. Real-time performance monitoring solutions will be essential to give early warning
of problems and to support network planning. IMS will drive spending in this area from
2008 onwards. The existing leaders in performance monitoring; Vallent, Telcordia, HP,
Ericsson and InfoVista; will evolve their installed base to meet these requirements.
Service fulfillment
IMS significantly changes the service fulfillment problem. Mature IMS deployments will
require a multiservice fulfillment solution that addresses the IP network and IT domains.
The specific IMS service fulfillment requirements are;
Multiservice activation
Common network resource management
IP quality of service planning tools
IMS client management
The following paragraphs provide more detail on these requirements.
Multiservice activation
Automated activation systems fall into two categories; those focused on network activation
for services like DSL, VPNs and Metro ethernet and those focused on activation of IT
systems such as HLRs for mobile services. IMS will have most direct impact on the latter,
but will require interaction between systems of both types. When a new IMS service is
ordered the activation process will configure the user profile on the HSS and on the
application server if required. These are IT oriented activation. It will verify the network
capability to support the service. This may require the activation of a DSL connection for
example. Finally it may need to verify the client capability to support the service. This
procedure involves IT activation, possible network activation and possible device
management. As a result, IMS will drive the need for multiservice activation systems that
integrate IT oriented activation, network activation and device configuration.
IMS will not start to drive significant spending in this area until 2008. At this point IMS
deployments offering a range of services over multiple access technologies will achieve the
scale that requires automated activation. The leading network activation providers;
17
MetaSolv and Syndesis, are well positioned to participate in this, but will compete with the
IT oriented activation providers such as Amdocs and Convergys.
Common network resource management

Network resource management will be impacted in a similar way to activation. There will
be a good business case to reduce operational costs by moving to a common network
resource management system across all access technologies. There will be a requirement to
include the IT oriented components such as HSS, application servers and media resource
servers. IMS will also emphasize the need to manage capacity and quality of service in the IP
network. Network resource management will need to track the capacity available for each
quality of service.
IMS world drive spending in this area in 2008. The leading vendors, Telcordia, Cramer
and MetaSolv are well positioned, but will need to add the IT management capability.
IP quality of service planning tools

The IMS model of providing a service across all available IP access puts enormous emphasis
on the network planning process. A new IMS service can be made available to all IMS clients
simultaneously. If the service takes off rapidly and uses significant bandwidth or has
demanding quality of service requirements it can quickly exceed available network capacity.
The service may be provided by a third party giving little visibility to the CSP. The CSP does
not want to lose revenue by denying service or delivering poor quality. We expect this to
become an issue in 2008 with a wider IMS deployment. There will be a significant consulting
opportunity for the NEMs services organizations.
IMS client management

IMS clients will be deployed on complex client platforms (mobile handset, PCs, set-top
boxes, PDAs) which are not under the direct control of the CSP. Initial IMS services such as
mobile video sharing will require a new handset with the client and application preinstalled,
but it will quickly become necessary to provide remote/over the air management of the
device. OMA has standardized some device management capabilities which have been used
for PoC clients. We expect that for mobile IMS deployments there will be spending on
device management from the first commercial deployments.
NEMs network management solutions

Most of the major NEMs recognize the importance of comprehensive EMS solutions for
their IMS offerings. They have extended existing NMS solutions to manage IMS equipment
and are working with OSS partners to provide overall OSS solutions. In most IMS
deployments a network equipment manufacturer will provide the system and network
integration and take ownership of the overall solution. The initial IMS deployments are
relatively simple and NEMs will use their own EMS and NMS solutions to meet the OSS
requirement. However in 2007 the scale and complexity of deployments will require NEMs
to bring in OSS solutions from ISVs.
An interesting trend with IMS is to bring some OSS functionality closer to the network. In
billing for example the real-time charging subsystem has similar availability and performance
requirements to be network equipment. The HSS will bring some of the subscriber
management functionality into the network. The NEMs are well-positioned to win this type
of business.
IMS Solution Suppliers

We have identified 24 significant suppliers of IMS equipment. The major
NEMs generally provide comprehensive IMS solutions, IT companies focus
18
19
on the application server and provide SDP capability and smaller specialists
deliver focused application servers.
Acme Packet
Alcatel
Apertio
BEA
Broadsoft
Cisco
Ericsson
{ { {
z z { z {

Italtel
Lucent
{ {
{ { { {
{ z
HP
IP Unity
{ {
{ { { { {

{
{
z z z z
Motorola
z { z
NEC
{ { z z
Nokia
z z z {
Nortel
Personeta
Siemens
Sonus
Tekelec
Telcordia
Comments
Business
Services
z z z z z z
IBM
Mobile
{ { {
Hotsip (Oracle)
Huawei
Residential
Broadband
ROW
EMEA
NA
Overall
Vendor
Table 3: Comparison of IMS equipment providers
z z

{
{
Provided the proxy CSCF for BT in

partnership with Alcatel. Session
border controller specialist.
Provides comprehensive IMS
solution for fixed and mobile
operators.
HSS specialist. Provides subscriber
data management solutions for TMobile, Orange and Vodafone UK.
Provides IMS application server and
network gatekeeper.
VoIP application server specialist
Provides IMS solution for fixed and
mobile.
operators.
Provides presence server for
Ericsson IMS offering.
Provides HSS and IMS application
server.
mobile operators.
Provides IMS application server.
Provides media servers and
application servers. Siemens
application server partner.
Provides IMS solution in partnership
with Cisco.
operators.
mobile operators.
mobile operators.
solution for mobile operators.
mobile operators.
IMS application server specialist.
solution fixed and mobile operators.
VoIP network specialist.
Signaling network specialist.
IMS real-time billing and application
server provider.
20
Ubiquity
Comments
Business
Services
Mobile
Residential
Broadband
ROW
EMEA
NA
Overall
Vendor
IMS application server provider.

Partner with Nokia, HP, Siemens and
Lucent.
{ = has a presence in the market

= has a notable presence in the market
z = market leader
Source: Company briefings and OSS Observer analysis
Ericsson
Ericsson is the worldwide market leader for mobile equipment supplied to CSPs. Revenues
from selling telecoms equipment, software and services to CSPs was approximately $17.7
billion in 2005. More than 90% of this is from mobile networks. Ericsson claims more than
40% market share in the GSM/WCDMA market. It also supplies CDMA 2000 equipment.
Ericsson provides a comprehensive portfolio of IMS products and applications.
Ericsson completed the acquisition of most of Marconi's product portfolio in January 2006.
This significantly strengthens Ericsson's position in transport networks and in fixed
broadband access. The acquisition included Marconi's Impact IMS product line. It is not yet
clear how this will be integrated with Ericsson's existing IMS product line.
Publicly announced customers include:
Vodafone Group - selected Ericsson as its IMS vendor in February 2006.

Telenor - trial of fixed mobile convergence.
TeliaSonera trial of common applications across fixed and mobile plus IP
telephony and PoC.
Telefonica - has deployed Ericsson's IMS solution in its fixed network to support
IP Telephony and IP Centrex. It launched IP telephony for residential users in June
2005.
TDC in Denmark - IP telephony and IP Centrex.
Commander in Australia - multimedia services over residential broadband.
Telecom Italia Mobile - enriching voice capabilities with sharing of video and
white boarding.
Sprint - major system integration project started in 2004.
Ericsson provides IMS applications for push-to-talk, video sharing, video telephony, IP
Centrex, IP telephony and IMS messaging. It also offers a full service creation environment,
provisioning solutions, real-time convergent charging and single sign-on. The service
creation environment is part of Ericsson Mobility World that includes a partner program
and a large developer community. Ericsson provides handset software platforms and claims
30% market share for UMTS handsets. IMS clients are available on the platform.
The Ericsson IMS products are shown in table 4, the fixed and mobile IMS products share a
common platform.
Table 4: Ericsson IMS products
21
Product
Capabilities
Engine Multi Media (EMM 2.0)

IP Multi Media (IPMM 2.0)
IMS client
Parlay gateway
Marconi IMS offering
IMS solution for fixed line operators

IMS solution for mobile operators
Available on Ericsson Mobile platform
Provides secure third-party access to network resources
Impact IMS Session Controller XCD6000 series
Source: OSS Observer, Ericsson
IMS partners include Broadsoft and Hotsip, which was recently acquired by Oracle.
Ericsson is the leading supplier of IMS solutions and is well placed to retain that position. It
has a comprehensive IMS offering for both fixed and mobile operators. As the market
leader in mobile solutions it has the best solution delivery capability and sales channel for
mobile IMS solutions. The recent acquisition of Marconi has significantly strengthened its
offering for fixed operators. As CSPs move to consolidate their fixed and mobile operations
Ericsson is well positioned to provide a comprehensive IMS solution.
Siemens
Siemens is a diversified business with revenues in excess of $90 billion in 2005.
Approximately $12 billion of this is from selling telecoms equipment, software and services
to CSPs. This number excludes the handset business that was sold to BenQ during 2005.
The telecoms business is approximately 60% from mobile networks and 40% from fixed
networks. It is profitable with modest growth overall from 2004 to 2005. The mobile
networks business is the main source of profit and growth. Siemens has been particularly
successful with the UMTS NodeB product developed jointly with NEC. The fixed networks
business has been particularly successful in the soft switch and VoIP segments with the
SURPASS product line.
Key customers include Vodafone, TeliaSonera, KPN, France Telecom, and Siemens
claim more than 35 IMS projects. KPN has a selected Siemens to provide VoIP, IMS and
fixed mobile convergence across its operating companies. France Telecom has been testing
the Siemens solution for fixed mobile convergence.
Siemens provides IMS applications for push to talk, presence and instant messaging. The
solution includes interfaces for real-time billing and CDR collection.
Siemens major IMS products are listed in table 5.
Table 5: Siemens IMS products
Product
Capabilities
CFX-5000
CMS-8200
Multimedia Session Controller (CSCF)

Home Subscriber Server including the User Mobility Server
for IMS subscriber information.
hiQ 4200
Application servers
Application server for consumer and business voice services.

Application servers for instant messaging, presence, push and
talk and conferencing.
Source: OSS Observer, Siemens
IMS partners include Ubiquity and IP Unity.

Siemens provides a comprehensive IMS solution. Its strength on the fixed side with VoIP
solutions positions Siemens well for the fixed IMS opportunity. It also has a strong position
on the mobile side and is therefore well positioned for fixed mobile convergence.
22
Lucent
Lucent made approximately $9 billion in revenues in 2005 for telecommunications
equipment, software and services sold to CSPs. More than 90% of Lucent's revenue is in
this segment. The business was profitable and showed modest growth of 4.4% from the
previous year. Mobile networks generated more than 60% of revenues and grew 12% from
the previous year. Lucent is the worldwide leader in CDMA equipment. Lucent's biggest
customer is Verizon.
Lucent claims 7 commercial IMS deployments and 77 trials with 16 customers. Lucent is
having most success in consumer VoIP and in fixed mobile convergence opportunities. It is
also having success with enterprise VoIP applications. The major publicly announced
customers are AT&T, BellSouth, Sprint, O2 and Cingular.
Lucent provides IMS applications for fixed mobile convergence, multimedia messaging,
presence, location, push to talk, active phone book, IP PBX and gaming.
Lucent's main IMS products are listed in table 6.
Table 6: Lucent IMS products
Product
Capabilities
Lucent Session Manager
Provides CSCF, service broker, service capabilities interaction

manager, policy decision function and breakout gateway
function.
Provides telephony services and support for FMC dual mode
phones.
Provides single portal for wireline or wireless access. Includes
access to voice mail, e-mail, instant messaging, buddy lists.
Provides IMS compliant media gateway control function and
signaling gateway function.
Provides the IMS HSS function.
Lucent Feature Server

Lucent Communication Manager
Lucent Network Controller
Lucent Unified Subscriber Data
Server
Lucent Active PhoneBook
Lucent MiLife Application
Server
Network hosted dynamic address book.

Application server with service creation and customization
tools.
Source: OSS Observer, Lucent
IMS partners include Ubiquity, Kodiak, Openera and Xten.

Lucent provides a comprehensive IMS solution for fixed and mobile operators. It is the
leading IMS vendor in North America and is likely to be the main supplier of IMS solutions
to most of the Tier 1 CSPs in this region.
Nokia
Nokia finished 2005 with revenues of approximately $40.5. The majority of this is from
mobile phones where Nokia is the worldwide market leader. Nokia is a major supplier of
telecoms equipment, software and services to CSPs. This business generated revenues of
approximately $7.9 billion in 2005; nearly all from mobile networks. It has a strong position
in supplying GSM, EDGE and UMTS networks in Europe, Latin America and Asia.
Nokia claims commercial IMS contracts with 14 customers and trials with 18 customers.
The major commercial successes are with Vodafone, Telecom Italia Mobile, TMN and
CSL. The main application is video sharing, which has been launched as a commercial
service by three operators. Nokia has major trials with France Telecom, TeliaSonera,
Telecom Italia and Telkomsel. Nokia also claims 47 commercial PoC deployments and
16 commercial presence deployments.
23
Nokia provides IMS applications for video sharing, push to talk, presence, list management,
IP Centrex, IP telephony and fixed mobile convergence. Nokia is in a particularly strong
position with its influence over client platforms. It provides 18 mobile handsets which
support a SIP stack and 10 of which have integrated video sharing capability.
Nokia's IMS products are listed in table 7.
Table 7: Nokia IMS products
Product
Capabilities
Nokia connection processing

server
Nokia IP multimedia registry
Nokia presence server
SIP clients
IMS CSCF capability on ATCA platform.

IMS HSS capability
Supports presence application.
Downloadable SIP clients for Symbian platform.
Source: OSS Observer, Nokia
Nokia IMS partners include Ubiquity and Hotsip.

Nokia provides a comprehensive IMS solution for mobile operators and is gaining ground in
fixed mobile convergence applications. It has been particularly successful in the push to talk
(PoC) market and will transition these customers to IMS. Nokia's strength in the mobile
softswitch market is also a significant advantage.
Alcatel
Alcatel offers a broad range of telecoms equipment, software and services for both
wireline and mobile CSPs. Revenues from this business will be approximately $11 billion in
2005 with 55% from fixed networks and 45% from mobile networks. Its most successful
market is DSL broadband access networks. The mobile business continues to grow, but the
fixed voice business is declining rapidly. Overall Alcatel has strong solutions offerings in new
growth areas such as IPTV, UMTS, IMS and VoIP.
Alcatel claims more than 20 IMS trials and deployments. Telefonica and France
Telecom are running major trials of IMS applications using Alcatel equipment. BT is in the
process of moving its BT Communicator service to IMS compliant Alcatel components.
Alcatel also claims to have 70 IMS ready deployments with customers who have deployed
Alcatel softswitches.
Alcatel supports IMS based enterprise VoIP services, consumer VoIP services and dual
mode fixed mobile convergence. It has also integrated its IMS offering with IPTV to support
integrated presence and voice conferencing.
Alcatels IMS products are listed in table 8.
Table 8: Alcatel IMS products
Product
Capabilities
Alcatel 5020 Softswitch
Provides the serving CSCF functionality. In BT Alcatel

partnered with ACME to provide the proxy CSCF
functionality.
Provides HSS and SLF functionality. Can also provide HLR and
AuC functionality or access an external HLR.
Includes a presence server, client software, network based
address book, group management capabilities. Can be used in
non-IMS environments. Web development environment
supporting SIP servers and Web services.
Application server for advanced hybrid applications (IN, SIP,
etc.) & converged payment
Alcatel 1430 IP MultimediaHome Subscriber Server

Alcatel 5350 IMS Application
Server
Alcatel 8690 OSP
24
Alcatel 8688 Media Resource

Function
Open Service Delivery
Environment
Audio and video announcement capabilities. DTMF detection,

in-band and out-band.
Service delivery platform supporting IMS and other services
such as triple play. 5350 application server is part of this
platform.
Source: OSS Observer, Alcatel
Alcatel partners with Accenture and Cap Gemini for system integration of the service
delivery platform.
Alcatel provides a comprehensive IMS solution for both fixed and mobile services. It will
leverage its strength in the IPTV market to provide integrated IMS applications. Alcatel also
has a strong SDP offering which will complement its IMS solution.
Other IMS suppliers

All the leading NEMs provide IMS solutions. The current leaders are Ericsson, Siemens,
Lucent, Nokia and Alcatel, but the market is in its early stages and relative positions
could change considerably before the market matures. NEC, Nortel, Cisco and
Motorola all have strong IMS offerings that will take a share of the market.
Telcordia, HP and BEA are major suppliers who have strong IMS products, but have
chosen not to provide the CSCF capability.
Market definition and IMS background

This section provides some background on IMS technology, standards and
products. It also defines which products are included in the IMS equipment
forecast.
3GPP IMS architecture and products

3GPP is the standards body that has led the definition of the IP Multimedia Subsystem.
3GPP have released a series of standards relating to all aspects of the evolving mobile
telecommunications network. These have incrementally introduced IP technology into the
mobile network. IMS was introduced with Release 5 in March 2002.
Some important releases are:
Release 99 - introduced the WCDMA radio access network and defined the
interface to the GPRS packet switched network. With this release the circuit
switched and packet switched networks remained largely separate, sharing only
some of the mobility control infrastructure. The Open Service Architecture (OSA)
was also introduced for service creation. The release was completed in December
1999.
Release 4 - introduced a common IP core network for both circuit switched and
packet switched services. The circuit switched services are supported by MSC
servers and MSC gateways. The release was completed in March 2001.
Release 5 - introduced IMS as the control plain for multimedia services based on
the SIP standards developed by IETF. With this release voice services can be
delivered over the IP network end to end from handset to handset. The release
was completed in March 2002.
Release 6 - includes significant enhancements to IMS including interworking with
WLAN. The release was completed in September 2005.
Release 7 - is still under development and will include voice call continuity between
fixed broadband and cellular networks.
25
ETSI TISPAN is a separate standards effort focused on adapting the IMS standards to the
needs of fixed line operators. It is expected that 3GPP Release 7 will include the TISPAN
work.
The IMS architecture diagram is shown in figure 4.
Figure 4: IMS architecture from 3GPP and TISPAN
Service
ServiceDelivery
DeliveryPlatform
Platform
Service
Layer
Presence,
3rd
Party Access, Messaging, Location,

Application Server
Diameter
HSS
IMS Control
Layer
ISC/SIP
Diameter
CSCF
SIP
Transport
Layer
MGCF+MGW
IP Core
Circuit Switched
SIP
Access
Layer
UMTS
CDMA
3G Mobile
WLAN
Dual Mode
SIP
SIP
xDSL
Cable
Fixed Access
GSM
PSTN
Legacy Voice
IMS Client
Layer
Source: TISPAN, 3GPP
Key components of the IMS are:
CSCFs - the serving CSCFs (call session control function) are at the core of the
IMS layer. It routes the SIP signaling between SIP clients. It also downloads the user
profile from the HSS and uses the filters defined there to route SIP packets to any
required application servers. There are also proxy CSCFs that are the first contact
points for clients and often handle the policy decision function and interrogating
CSCFs that handle connections to other operators. All CSCFs use the diameter
protocol to report charging information.
HSSs - the HSSs provides the permanent storage for user profile information. This
is made available to both the CSCF and the application servers through a diameter
interface. The HSS includes the HLR and AuC capability required for the mobile
network.
Application Servers - this lies above the IMS control layer and provides the
platform for additional services. Examples are presence, group list management,
instant messaging, push to talk. Application servers use the SIP based ISC interface
from the serving CSCF. SIP application servers, Parlay application servers and
camel application servers are supported. Many services will also make use of the
media resource function defined within IMS.
IMS Clients - many different hardware platforms can potentially support IMS
clients. The client must have IP connectivity and a SIP protocol stack. The 3GPP
standards include an IMS services identity module that stores user identity, security
keys and administrative information.
MGCF and MGW - media gateways and media gateway controllers are included in
the IMS architecture to provide interworking with the circuit switched networks.
The IMS 3GPP standards also provide specifications for real-time charging capabilities. Every
IMS network entity can be configured to detect a chargeable event based on the content of
SIP messages. Charging information is exchanged using the diameter protocol. An online
charging system is defined so that service can be denied in response to the chargeable
event. The standards also include an offline charging capability.
The service delivery platform shown in figure 5 is not part of the IMS standard, but will be
an essential component in the rapid creation of new services that make use of the IMS
infrastructure. The service delivery platform uses an IMS application server to execute the
service logic that has been created.
An operator can enable third party service providers to use IMS capabilities in a secure and
controlled fashion using the OSA framework. In the IMS architecture this appears as an
application server.
Market definition
The OSS Observer IMS equipment market forecast (figure 2) includes spending by CSPs on
the deployment of IMS standards compliant equipment. A deployment, which includes at
least the CSCF, HSS and application server capabilities, will be counted in the forecast. The
forecast itself includes spending on CSCFs (serving, proxy, interrogating), HSSs, application
servers, policy control functions and other IMS equipment. It excludes media gateways and
media gateway controllers and IMS clients.
Figure 5: OSS market segments
26
27
OS S Obs erv er Market S egments

B illing
S erv ic e
as s uranc e
Cus tomer c are
S erv ic e
fulfillment
R ating & P ricing
CR M
S erv ic e
m anagement
Order management
Interconnec t
S ubs criber
m anagement
F ault & ev ent

m anagement
NR M/
Inv entory
Cus tom er
interaction
P robe s y s tems
A c tiv ation
Workforce
automation
P erformance
monitoring
E ngineering
tools
Mediation
R eal-tim e c harging
F raud & R ev enue

A s s urance
Com ponent Integration S oftw are
Netw ork E quipment Manufacturers E lement Managem ent S y s tems
Source: OSS Observer
The OSS Observer forecast for OSS spending related to IMS (figure 1) includes spending on
all OSS functional areas (figure 6) which are specifically driven by these IMS deployments.
IMS related standards

Standards closely related to IMS:
Parlay - has driven standardization of the service creation environment and the
infrastructure to enable third parties to provide services. Have provided the basis
for the OSA standard in IMS.
Open Mobile Alliance (OMA) - drives standardization of mobile service enablers.
Has established a push to talk over cellular standard (PoC) which can use the IMS
infrastructure. It includes separate application servers to support presence, group
list management and the push to talk service.
TISPAN - an ETSI working group that is driving standards for the use of 3GPP IMS
capabilities in a fixed line environment.
Recommendations
CSPs are presented with some long-term organizational challenges with the
operation of an IMS network. To obtain the full value from IMS it must
become the single control layer for all access technologies. This will require
the merging of network operations, customer care and billing organizations
that have historically been separate for the different technologies. The
approach should be a pragmatic one; deployed IMS for a specific service,
develop the business processes to support it and then roll these out through
the organization.
28
Early investment in real-time convergent billing will be essential in the competitive battle
with the best efforts providers such as Google, Skype and Yahoo. CSPs have the
opportunity to use bundling and tariffs to make IMS services more attractive than the best
efforts competitors. TMN in Portugal has shown early success with IMS based video
sharing by targeting families with a bundle including multiple handsets and attractive voice
and video tariffs.
CSPs must move towards multiservice OSS solutions to control the cost of operating IMS
based services. This means developing a strategy for standardizing on horizontal functional
solutions for each of the major OSS areas and avoiding where possible short-term
technology specific solutions. Functions like order management, activation and network
resource management must be common across the different access technologies and
services.
The customer experience for IP multimedia services will be critical to the success of IMS.
CSPs must invest in the service assurance capabilities to manage the customer experience.
This means early investment in probe-based solutions to monitor and measure customer
experience. Longer-term, CSPs will need to invest in a horizontal service management
capability.
OSS vendors must put together a coherent strategy for IMS support now
and communicate it to the market. However, IMS will not drive significant
revenues until late in 2007 for most OSS vendors; real-time convergent
billing being the exception.
The major OSS vendors must select their target for the horizontal multiservice functionality
they wish to own. The choice for most vendors is reasonably clear, but IMS will change the
OSS landscape in certain areas. Activation for example becomes less about specific network
technologies and more about breadth and scalability. Many billing functions move to near
real-time and become more closely tied to the network. Service management will be more
closely tied to the service delivery platforms. Vendors must consider these long-term
changes.
Smaller OSS vendors will not have the critical mass to own a major horizontal functional
area and will need to align themselves with vendors who can. There will be opportunities
for innovation in a number of areas; including monitoring the customer experience for IP
multimedia services, network planning and performance management and service modeling.
Published by OSS Observer LLC

PO Box 1319
Sugar Grove
Illinois
60554-1319
Tel: +1 630 466 9223
Fax: +1 630 566 3863
Email: info@ossobserver.com
Web site: www.ossobserver.com
2006 OSS Observer LTD
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any
form or by any other means - electronic, mechanical, photocopying, or recording or by any otherwise - without the
prior written permission of OSS Observer LLC.
OSS Observer LLC maintains that all reasonable care and skill has been used in the compilation of this document.
However, OSS Observer LLC shall not be under any liability for loss or damage (including consequential loss)
whatsoever or howsoever arising because of the use of this document by the customer, his employees, contractors,
agents or any third party.
29

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Outlook

IMS impact on OSS

n 2005 the first commercial IMS services became available. There

Figure 1: OSS forecast, p1

Figure 3: IMS architecture,

Figure 5: OSS market

Table 1: Commercial IMS

Table 2: IMS contracts, p12

Table 3: IMS equipment

Total OSS spending

Figure 2: IMS equipment

Figure 4: IMS architecture 3GPP and TISPAN, p25

Source: OSS Observer

Table 4: Ericsson, p20

2006 OSS Observer LLC. All rights reserved worldwide

IMS Outlook: 2006-2011

Application driven spend

$1,250 $1,750 $2,530

$1,490 $2,110 $2,430

Source OSS Observer

2006 OSS Observer LTD. All rights reserved worldwide

IMS Outlook: 2006-2011

Commercial OSS forecast for IMS equipment and related

2006 OSS Observer LTD. All rights reserved worldwide

IMS Outlook: 2006-2011

Examples of IMS based services:

Presence - real-time status and current preferred method of communication for

IMS architecture and products

Presence, 3rd Party Access, Messaging, Location,

Real time charging

Source OSS Observer

2006 OSS Observer LTD. All rights reserved worldwide

IMS Outlook: 2006-2011

The principle components of the IMS architecture shown in figure 3 are:

Enable new multimedia services

Competition from bit pipe operators and best efforts services

2006 OSS Observer LTD. All rights reserved worldwide

IMS Outlook: 2006-2011

Rapid, low-cost deployment of new services

Fixed mobile convergence

Common IMS core

Differentiate from "best efforts" service providers

2006 OSS Observer LTD. All rights reserved worldwide

IMS Outlook: 2006-2011

IMS client availability and usability

2006 OSS Observer LTD. All rights reserved worldwide

IMS Outlook: 2006-2011

requires hands-free capability in addition to a video

camera. The market penetration and

Compelling IMS applications

2006 OSS Observer LTD. All rights reserved worldwide

IMS Outlook: 2006-2011

Source: OSS Observer, Company briefings

Push to talk over cellular

2006 OSS Observer LTD. All rights reserved worldwide

IMS Outlook: 2006-2011

Push to talk over cellular

Voice over IP in the fixed network

Fixed mobile convergence

2006 OSS Observer LTD. All rights reserved worldwide

IMS Outlook: 2006-2011

Real-time convergent charging