Softswitch not so Soft

T he last few years have seen the emergence of Next Generation Networks (NGN)
not only to cater to high growth in data/packets, but also to bring down opex
and improve service offering. At the center of this have been ‘softswitces’.
The sharp industry slowdown and the so-called Internet bubble burst, have
adversely affected many carriers around the world. It has made the industry
over-cautious with the new technological trends, driven especially by data or
packet growth. One would believe softswitches to be one of them.

Despite challenging economic conditions, many alternate carriers/service
providers, with sound business models and well positioned for market success,
have continued to invest in softswitch architectures to secure their position in
a competitive environment and ensure future growth. In addition, many incumbent
carriers/PTTs and wireless operators are aggressively moving forward, with plans
to deploy packet-based voice solutions by leveraging softswitch technology.
Global deregulation and government-based policy strategies have committed many
nations to privatize their national telephony operators, creating economic
incentives to remain competitive with NGNs using ‘softswitch’ solutions, but
the softswitch will not be so soft in the times to come.

Reduced capital equipment budgets will dampen the investments in new technologies like softswitch, but can’t overlook savings that they


According to Cahners In-Stat/MDR, the softswitch market is in the very early
stages of a long growth period, as the public switched telephone network (PSTN)
is getting transformed into a packet-switched network capable of supporting
voice, data and video. They predict that softswitch will be a key component of
this transformation, as it controls media gateways, IP phones and integrated
access devices in the packet-switched network, and provides inter-working with
the traditional circuit-switched network. Reduced capital equipment budgets will
dampen the investments in new technologies like softswitch. However, it cannot
be overlooked that softswitches and related technologies can reduce cost and
provide for increased service revenue.

Softswitch Terminology
softswitch, short for ‘software switch’, is a generic term for any
open application program interface (API) software that is used to bridge a
traditional PSTN and VoIP, by linking PSTN to IP networks and managing
traffic that contains a mixture of voice, fax, data and video. It
separates call control functions of a phone call from the media gateway
(transport layer). Softswitches are able to process signaling for all
types of packet protocols. Softswitch is a software-based switching
platform based on open systems as against traditional proprietary
hardware-based switches. Softswitch is also called media gateway
controller, call agent and gatekeeper.

Functions of a softswitch have been
categorized into four different layers:

  • Applications and features
  • A service-creation environment
  • Call control or a call agent
  • Protocol mediation enabling
    devices, such as gateways using different protocols

Market Growth
As the VoIP market continues to attract the interests of carriers, the
worldwide softswitch market for 2006 estimates ranges from In-Stat/MDR’s $1.32
billion (representing a CAGR of 60.2 percent over the forecast period 2001-
2006) to $4.1 billion (a CAGR of 119 percent) on the other end. The market will
continue to experience strong growth beyond 2006. Allied Business Intelligence
reports "While North America is leading the charge in softswitch
development, it is the Asia-Pacific region targeting at the highest
growth". The firm cites the region’s readiness to accept technology and
its use of VoIP for long distance toll arbitrage. It predicts that softswitch
will act as an anchor within the next-generation network in the coming years,
and the circuit switch market is expected to decline over the next few years.

Companies competing in the softswitch market include traditional telecom
equipment providers like Alcatel, Lucent, Nortel, and Siemens, as well as a new
breed of companies with a strong IP/computers heritage like CommWorks, VocalTec,
Cisco, Sonus, Clarent, have emerged among the dominant players. As the carriers
are opting to cap investments in legacy technologies by leveraging softswitch
solutions, most of the legacy switch vendors have recognized this fundamental
shift in technology, and have realigned their development resources towards
packet-based softswitch solutions.


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