IP Services and Voice over IP
•
IP Services in Western Europe: The Case for a new IP Realism
•
Pros and Cons of IP Technology
•
Voice over IP
• Conclusions and What’s Next
Contact Details: Tolga Uzuner, Director, Technology Investments
– Tolga.Uzuner@drkw.com
| 1 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

.
IP Market Dynamics —Project Focus Areas
Supply Side
Corporate
Customer
Needs
Demand Side
Corporate
Applications/
Services
IP Services Consolidation
Consumer
Needs
Consumer
Content/
Services
IP Migration
Business Case
Emergence of
New Players
Critical study areas
Secondary factors
Other factors
Technology
Developments
Availability of
Finance
External Factors
| 2 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

•
IP services are unlikely to provide a growth catalyst of the magnitude required to bring telecoms out of the current crisis
• The “converged network of the future” will be a hybrid network where IP and legacy services complement each other
•
Shifts in the value chain and changing the dynamics of competition may cause vendors, service providers and systems integrators to focus on the same end-user attention
•
With some exceptions (e.g. IP Storage), the technologies underpinning IP are relatively mature, and the industry is in a later stage of its life cycle:
–
Expect to see vendor consolidation and a shift to process innovation
–
As in all other industries preceding it, the number of vendor/operators is likely to decrease over time, market leaders will consolidate their positions, and the nature of innovation will move from product to process innovation, the realm of the established vendor/operator.
•
IP-based technologies have failed to live up to their promise due to the uncalculated/hidden costs associated with complexity (e.g device proliferation, unpredictable nature of traffic):
– Hence, tech vendors offering products that solve complexity management issues are sure-fire winners.
– One of the few areas where we expect significant product innovation to occur and where we believe start-ups still have a reasonable chance of winning.
| 3 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

Traditional Services Definitional Framework
Voice
Data
Broadcast/
Media
Basic Services
Value Added
Services
Basic
Connectivity
Value Added
Services
•
Local, national, long distance calls
•
Freephone, local anywhere
•
Directory assistance, contact centres
•
PBX and centrex services, voice mail, call forwarding, call waiting, call return, caller ID, conference calling, find me services
•
Leased Lines
•
Connectivity
•
Access
•
Network management, element ownership, security, hosting, storage provision, application provision, video conferencing
Broadcasting
Services
•
Videoconferencing
Unanswered Questions
•
How to deal with voice services carried over data infrastructure?
•
How to deal with with unifying sevices that combine voice and data services?
•
How to deal with new services that result from convergence?
* Courtesy of Fred Destin
| 4 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

IP Connectivity
Services
• Internet access
• IP-VPN
Site to site
Extranets / branch offices
Remote Access
Outsourced
Managed
Customer Managed (DIY)
IP Voice Services IP Media Services
• VoIP in corporate networks:
Basic voice services
• Value added voice services:
Voice mail
Call forwarding
“Follow me” services
Call Centre Automation
• Video conferencing
• Web-casting
• Streaming
Unified Services
• Unified messaging
QoS /CoS/Security/OSS/BSS features (not typically sold outright)
Hosting
Physical/Digital
IP Storage
Storage/Disaster recovery
IP Advisory Services
* Courtesy of Fred Destin
| 5 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

* Courtesy of Fred Destin
| 6 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

IP Services Growth/Margin Matrix
50%
40%
30%
20%
Converged
Services
$0.30bn
VPN features:
$0.86bn
Security/QoS $1.36bn
Advisory
Managed + Hosting/
Storage Services
Access & connectivity
(incl. basic VPN)
$4.08bn
10%
$7.94bn
0%
0%
-10%
10% 20% 30% 40% 50% 60%
Margin
NB: All managed and outsourced elements of IP services have been included with hosting and storage revenues to reflect similarity in delivery capabilities.
Explaining the Results
•
The IP services market is expected to grow from its current size of $14.5 billion to $17.5 billion in 2004/5, with a
CAGR of 10%
•
IP VPN is the foundation layer on which value-added services will be built
•
VoIP will grow slowly, as it is not the optimal technology for scaling a voice business
•
Video over IP and unified communications will experience high take up after 24 months
•
Penetration of the IP storage market is low with huge growth potential
Players recognising IP-VPN (connectivity) as the foundation for upselling other services will likely be most successful.
| 7 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

Local Loop
Access
Incumbent Traditional Franchises
Voice
Transport
Data
Transport
Value-Added
Services
Advisory
Access Network
Specialists
• Low infrastructure deployment costs
• Parent financial support (utility cos.)
• New, urban areas targeted
• Hits at local loop data
• Pricing pressure
Examples
•
51 Degrees
•
Urband
International
Wholesale Voice over
Public Internet
• Proprietary network management software
•
Infrastructure light
• Carrier noncompetitive
Regional Alternative
Network Providers
• Advanced networks built from ground up to support IP services
• Deep network penetration
• Liberated from debt worries by Ch. 11
International/Metro
Wholesale Data
• Network designed from ground up to handle IP/MPLS
•
Low cost
• High-end service capability
• Some carrier neutrality
• Hits at int’l voice transport
• Pricing pressure
Virtual Service
Providers
• Infrastructure light
• Neutrality
• Service expertise
•
International flexibility
• Contract renewal on
<1 year cycles
Examples
• iBasis
•
ITXC
• Alt nets with network rings and local tails threaten leased line business
Example
•
Interoute
• Hits at int’l & metro data
• Carriers outsource IP services transport — lessen infrastructure burden
• Price pressure
• Hits at high-end services
• Undermines relationship with end customer
• Price pressure
Example
•
Level3
Examples
•
ET&T
•
Vanco
| 8 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

Drivers/Inhibitors 2002 2005
Integration of instant messaging agents to the desktop
Instant messaging
Unified communications
(including location-based services)
Converged
High cost and low quality of ISDN service
Emergence of better compression standards
IP videoconferencing to the desktop Media
Softwsitch architecture enables services today
Collaboration on voice & data improves productivity
Hybrid voice data architectures
Customer self-service for conferencing services
Distance collaboration using data (e.g. slides)
IP-Enabled
Voice
Legacy voice equipment is cheap and very efficient
QoS issues unresolved
VoIP
Voice
Critical business need for secure
Intranet connectivity
Financial pressure to reduce bandwidth bill
IP-VPN the foundation layer
Typically greenfield deployments before brownfield Connectivity
| 9 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

High
IT Buyer
Priority
Needs
Cost
Comparison of IT Buyer and End-User Needs
Migration
Reliability
Quality
Manageability
Mobility
Ease of Use
Multi-access a
Speed
Low
Low a. Ability to access over multiple devices.
End-User
Priority Needs
High
| 10 |
Current
Service
Provider
Focus
“Pull”
Opportunity for Service
Providers
© 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

TCP/IP
Protoc ol Suite
OSI Reference Model
Layer
7 Application
APPS 6 Presentation
TCP
5 Session
4 Transport
Benefits Associated with IP
Employs Open
Standards
Led to accelerated development of new applications
Accessible
Ease of Use
Connected all networks, regardless of operating system (also known as interoperability)
Point-and-click and click-through (hypertext mark-up language) for applications; browsers (Graphical User
Interfaces or GUI) for surfing
Universal
Uses comprehensive addressing system (Domain
Naming System - DNS)
IP 3 Network
2 Data Link
1 Physical
Intuitive
Efficient
Use of Uniform Resource Locator (URL) or www.xxx.com
allows access without number
Connectionless: disperses and reassembles packets using only resources required
Stateless: network remains dumb, unaware of rest of network; applications/devices are intelligent
* Courtesy of Fred Destin
| 11 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

The question remains: when it will conquer the ‘real time’ world of voice and video
Mantra vs. Current Position
Mantra
•
IP dominates the LAN
•
IP is the ultimate mediation layer between application and infrastructure
•
IP internetworking is the most cost effective and universal way to scale a multi-service network

Therefore IP is the fundamental connectivity protocol of the future
Voice
Video
Net access
E-mail
Transactional &
Messaging
Apps
“Traditional”



Is IP really going to live up to its billing as the “unstoppable internetworking protocol”?
IP
?
?
* Courtesy of Fred Destin
Migration
& QoS
Issues a
| 12 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

Not Better
•
Of 50 companies interviewed, 30 cited quality and reliability as reasons for not using VoIP: a
– The benefits of VoIP are hard to justify while Quality of Service issues are not yet resolved
•
93% of IT Managers state security as a key barrier to deploying IP-VPNS b
Not Cheaper
•
Equipment costs still high, payback uncertain:
– IP phones too expensive
–
No cost savings until $100 each
– Traditional PBX cost is also lower when counting implementation costs for a new
IP PBX
– IP PBX estimated 5-year payback may be too long
•
Falling PSTN prices, have eroded VoIP’s price advantage
– Sometimes referred to as Toll-bypass
Not Simpler
•
Can be more complex: 60% of IT managers said ease of use/management issues were barrier to IP-VPN deployment c
•
Migration to new IP services has often resulted in requirement to operate simultaneous systems.
•
Issues of inter-operability, billing and customer service have also emerged for service providers a. See IDC, “Attitudes towards IP Telephony in European Corporations”, October 2001. b. Internet Week Research, VPN usage survey based in US users (multiple responses accepted). c.
Forrester, “Surviving A Metro Bandwidth Crunch”, December 2001.
* Courtesy of Fred Destin
| 13 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

Core
Transport Architecture Technical Implications
•
Dynamic Circuit Switching:
•
IP playing a secondary, supporting role, for Internet access
•
QoS is free!
Winning Vendors
•
Vendors with dynamic circuit switching offerings:
–
Next-gen Sonet, not Mesh
–
Reconfigurable networks
Edge
Access
•
Mix of packet and circuitswitched, using multi-service edge equipment:
–
Driven by customer demand
–
Packet interface to access and circuit interface to core
•
Packet-switched networks will dominate intranets over the medium term:
–
IP, over time, will dominate corporate LANs and WANs
•
QoS statically managed:
–
CoS on packet interface to access
–
Topologically optimised for
Internet access
–
Ditto on circuit interface to core
•
QoS actively managed:
–
Real-time monitoring, measuring and reconfiguring
–
Without breaking the basic stateless/connection-less paradigms of IP
•
Strong multi-service edge offerings based on packetswitching architectures:
–
Key features are switched routing, and edge optical nodes
•
Corporate IP vendors, and access/LAN IP QoS management vendors:
–
Dynamic, policy-based QoS based on business objectives
| 14 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

• From a paper presented at Hotnes, Princeton, October 2002: “
Is IP going to take over the world (of communications)?”
–
Pablo MolineroFernandez, Nick McKeown, Stanford University; Hui Zhang, Turin Networks and Carnegie
Mellon University
•
"It remains ill suited as a means to provide many other types of service; and is too crude to form the transport infrastructure in its own right."
•
"The growth and success of IP has given rise to some widely held assumptions amongst researchers, the networking industry and the public at large. One common assumption is that it is only a matter of time before IP becomes the sole global communication infrastructure, dwarfing and eventu ally displacing existing communication infrastructures such as telephone, cable and TV networks."
•
"But for all its strengths, we (the authors) do not believe that IP will displace existing networks; in fact, we believe that many of the assumptions discussed above are not supported by reality, and do not stand up to close scrutiny."
•
"It is the goal of this paper to question the assumption that IP will be the network of the future. We will conclude that if we started over - with a clean slate - it is not clear that we would argue for a universal, packet-switched IP network."
•
"We take the position that while IP will be the network layer of choice for best-effort, non-mission critical and nonreal time data communications (such as information exchange and retrieval), it will live alongside other networks, such as circuit-switched networks, that are optimized for high revenue time-sensitive applications that demand timely delivery of data and guaranteed availability of service."
•
"At the core of the network, we expect the circuit switched transport network to remain as a means to interconnect the packet switched routers, and as a means to provide high reliability, and performance guarantees. Over time, more and more optical technology will be introduced into the transport network, leading to capacities that electronic routers cannot achieve."
| 15 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

•
Small IP networks (such as Corporate LANs and WANs) are cheaper and simpler to operate than small circuit-switched networks:
– Enterprise packet-switching is considerably simpler and cheaper to manage.
–
The number of components in an all IP corporate LAN can be significantly smaller than a circuit- switched infrastructure with N^2 characteristics, especially in highly interactive corporates like banks, the pharmaceutical sectors, large engineering firms, and the military.
–
The power/density/operational complexity characteristics of IP infrastructures in a core network. [NOT CLEAR]
•
QoS solutions for corporate LANs and WANs are becoming more manageable with the advent of policy-based management technologies:
–
Both from a hardware/software and operational perspective.
•
Service providers will also need to maintain packet-switched architectures to enable
Internet access and other services:
–
E.g. managed services, such as storage and hosting, where most corporate interfaces will be IP.
– E.g. multi-party services, such as audio, video, and web-enabled conferencing, due to the N-squared complexities associated with trying to provide these services efficiently off a circuit-switched infrastructure.
From our conversations with buyers, systems integrators, and service providers, we are convinced the future of enterprise LANs and WANs will be all IP.
| 16 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

IP VPN
Voice over IP
Video over IP
Unified Communications
Quality of Service
IP Storage
•
What are the drivers and inhibitors of VoIP uptake
?
•
What other value-added services might VoIP enable service providers to offer?
•
What does the voice migration architecture look like ?
•
Who are the potential winners in the Voice over IP arena?
•
What is the outlook for VoIP in the short term?
| 17 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

Inhibitors to VoIP
•
Low cost and efficiency of legacy PSTN equipment weakens the business case for migration to VoIP
•
Tolerance for medium quality video is high but tolerance for even mildly reduced voice quality is very low
•
Replacing a TDM switching fabric with routers is not likely to deliver enhanced performance
•
PBX depreciation cycles are quite long and delay VoIP adoption
•
MGCP (in cable) vs SIP XML (Telcos and mobile operators) debate is making interoperability more difficult for all vendors
Source: CGEY and DrKW Analysis
| 18 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

The example of Voice, a delay sensitive application where users tolerate minimal drop in quality
Site A
Phone
Coder
Delay
First
Mile
Queuing
Delay
Buffer 1
Delay
Network Buffer 2
Delay
Queuing
Delay
Last
Mile
Dejitter
Buffer
Delay
Coder Delay G.729 (5msec look ahead)
5 msec
Coder delay G.729 (10msec per frame)
Queuing delay and Network Buffer delay
20 msec
??
Site B
Phone
Voice can tolerate only 100 msec; margin for error is small
Propagation Delay (private lines) 0 msec ?
Dejitter Buffer
Total
* Courtesy of Fred Destin
50 msec
75 msec + ??
| 19 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

Advantages for Service Providers
Internet offload
Intercept dial-up calls handled by the IP infrastructure avoid clogging up
Class-5 and Class-4 switches
Improve mesh performance
Adding switching capacity has decreasing advantages as more ports get allocated to interconnect with other elements of the mesh rather than to handle new calls
Operational savings
By using, for example, an ATM cloud for the interconnect service providers can greatly reduce the number of trunks they need to manage
Deliver new hybrid applications
Source: CGEY and DrKW Analysis
Many of the applications that mix voice and data, which generally involve SIP manipulations, require IP anyway to interact with intelligent clients
| 20 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

Customer Demand
•
Economic advantages of packet voice are driving access voice networks from circuit to packet switching
•
Corporate demand for:
–
Unassisted,on-demand, reservation-less conferencing services
–
Unified messaging
–
Call centres
•
Obligation to deliver local number portability, emergency and directory services
•
Web-based invitation, notification, scheduling and device control
•
Unified network to allow unified and simplified management
New Architecture
•
Interoperable technology is finally becoming available to enable VoIP over LANs and increasingly WANs
– PBX interoperability is improving in brownfields
•
In next-generation carrier networks:
– Voice traffic between traditional voice networks and new packetbased networks will be directed by media gateways and media gateway controllers, which will be handled by soft-switches
•
There are two key concepts behind these new networks:
– Media gateways, signalling gateways, media gateway controllers and application servers will be divided into separate logical network components
– These components will communicate with one another through the use of intra-switch protocols such as Media Gateway Control
(MEGACO), Media Gateway Control Protocol (MGCP),
SCTP/M3UA and Session Initiation Protocol (SIP)
VoIP today is more a question of delivering a suite of hybrid voice/data services than replacing TDM networks.
Source: CGEY and DrKW Analysis
| 21 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

Conferencing
A market experiencing explosive growth at present and that tops the agenda of vendors and users alike
Call centers
Huge addressable market further enabled by speech technologies for total customer contact and reduced operational costs.
Unified Messaging
A medium term winner delivering clear user experience and connectivity improvements
VoIP ToolBox
| 22 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

•
Centrex (central office exchange service) is a service from local telephone companies in which up-to-date telephone facilities at the service provider’s central office are offered to business users who do not wish to purchase their own facilities.
•
The Centrex service consists of allocating centralized capabilities among different business customers.
The customer is spared the expense of having to keep up with fast-moving technology changes (for example, having to continually update their private branchexchange infrastructure) and the phone company has a new set of services to bill for.
•
According to statistics compiled by RHK, the Centrex service is most popular with small to mid-sized companies with up to 400 lines. However, customers with over 1,000 lines represent over 20% of the existing Centrex base.
•
These larger customers have been increasingly investing in their own infrastructure, as suggested by the following data showing erosion of 8% per year from 1996 to 2001. The rate of decline is expected to increase to 12% per year from 2001 to 2005.
•
Meanwhile, smaller customers are expected to show only modest growth in the adoption of Centrex.
Another source of risk with Centrex customers is that as they switch from outsourcing to owning their own facilities, service providers risk losing other precious sources of revenue such as Web hosting, VPN offerings and Unified Communications. According to Lucent, such losses could add up to $750,000 per customer per week, or approximately $39 m per year.
Source: Ariane Mahler, CGEY and DrKW Analysis
| 23 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

Complexity Management
Device Proliferation
Issue
Elegantly bridging voice and packet networks
Solution
Integrated bearing/ signalling/control box
Telica
Deliver QoS sensitive services with limited knowledge of endpoint
Converged SIP based application delivery platform
Dynamicsoft
Winners
Interoperability, multi-vendor solutions
Product Innovation
No appetite for forklift upgrades Gradual migration in softwsitch architecture in multiprotocol world
Veraz networks
Integrating voice with other realtime apps
Multi-channel interface for application delivery
Scale packet based voice services Separate voice processing from application logic
Iperia, Voyant, Aspect
IP Unity (media server) Sylantro,
Pactolus (apps server)
Process Innovation
End-to-end solutions absent Control the value chain from the user interface up
Avaya
Source: CGE&Y and DrKW Analysis.
| 24 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

IP Devices
Cisco
Avaya
Ascom
Mitel
Polycom
Congruency e-Tel
Ericsson
Telstrat
Tundo
Nortel
Toshiba
Alcatel
Samsung
Source: CGEY and DrKW Analysis
Gateways
Sonus
Syndeo
Commworks
Taqua ipVerse
Convergent
Networks
Cisco (IP Cell)
Mockingbird
Tekelec
Nuera
Unisphere
Gallery IPT
Alcatel
Nortel
Lucent
Telcordia
Softswitches
Sonus
Syndeo
Commworks
Taqua ipVerse
Convergent
Networks
Cisco (IP Cell)
Mockingbird
Tekelec
Nuera
Unisphere
Gallery IPT
Alcatel
Nortel
Lucent
Telcordia
Application Servers
Dynamicsoft
Telephony@Work
Sylantro
Pactolus
Media Servers
IP Unity
Convedia
| 25 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

Conclusions on VoIP
•
IP is not the optimal technology for scaling a voice business:
– QoS slippage is not an option
–
Legacy infrastructure is cheap and very efficient
•
The transition to VoIP will be slow as each new service introduced must be value accretive and protect the value of legacy networks
•
Work on VoIP has led to developments in technology that enable delivery of real time services e.g. call centre automation and conferencing
•
The market take-up of these services depends on the design, pricing and bundling of attractive end-user applications:
–
It is up to the carriers to design and deliver IPenabled differentiated services that leverage existing TDM networks … without falling back into a minutes / bits price war
The near-term significance of VoIP is in the real-time IP Services that it enables.
Source: CGEY and DrKW Analysis
| 26 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

Key Findings
—Technology
•
Most IP services have crossed the
“Operational Chasm”—they work!
•
Proliferating technologies, standards, and devices have not yet given way to more integrated solutions
•
IP-VPN and voice/video over IP may enhance the next wave of services
•
QoS to deliver real-time IP is emerging, but selectively and slowly
• “IP everywhere” is neither always required nor always desirable
•
Costs of managing IP complexity may exceed many IP benefits:
– Too many ROI case studies fail to consider
“hidden costs" of complexities
– Additional software/hardware/”wetware”
(blood, sweat and tears) needed as device numbers increase.
– Tasks such as “coupling" and "amplification" are proving difficult in large-scale networks.
What It Means
•
QoS-driven IP services can evolve only where QoS issues resolved; not everywhere at once!
•
IP services with QoS work best in autonomous networks e.g. in the LAN or the service provider’s own core IP network
•
Corporate IP-VPN (not the internet) becomes the foundation and enabler for all other IP services
•
Massive technology disruptions are unlikely
Key Technology Challenges
•
Extend QoS across the WAN to include all brownfield and greenfield sites; becomes the basis for other services
•
Enhance legacy voice services with IP interactivity:
– For customer-activated conferencing, internal line provisioning, integrated communications interface, and other additional functionalities
•
Make corporate applications fully available to remote users and key external parties
•
Delivering IPv6 and end-to-end QoS across the internet cloud look to be many years away
| 27 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

QoS Solution/Method
Over-provisioning
Guaranteed bandwidth allocations or resource reservation
Traffic management
Application-driven QoS
Description
•
Common over-provisioning is for typical bandwidth utilisation
•
QoS over-provisioning is for peak utilisation
•
May raise questions of affordability
• Make sure preferred “bursty” bandwidth is available to QoS-sensitive applications
•
Determine preferred paths in network
•
Admission control
•
Data management: packet prioritisation, policing and shaping
•
Compression
•
Prioritise by application, not packet type or port
•
Measure and police network traffic in real time
•
Content management & caching
Tools
•
Increased edge/access infrastructure
(servers, switches, routers and gateways)
•
Implement circuit-switching with ATM
•
Implement connection-oriented IP with
MPLS
•
Signalled resource reservation with RSVP
•
Provision-class packet marking with
DiffServ
•
Standardised shaping/queue reordering/etc.
•
IPv6
•
Implement centrally controlled trafficmanagement tools and drive policies down to network elements in the LAN
•
Multicast & content-aware networking
Delivering quality is an inter-domain traffic engineering problem encountered at both the interface of the WAN and LAN and between service provider networks.
| 28 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved

•
No winners in next 24 months, only survivors.
•
IP services will grow steadily over the next two years (possibly 10%).
•
QoS has yet to be fully resolved: Be suspicious of any hype.
•
TDM voice networks will not disappear into some converged Nirvana; they work!
• “Converged networks” more likely means hybrid networks with IP enhancements, not fully converged IP networks.
•
Service providers and vendors are still not speaking end-user benefits.
| 29 | © 2002 Dresdner Kleinwort Wassertstein and Cap Gemini Ernst & Young - All rights reserved