Softswitch Market a High-Risk Opportunity, IDC Says

FRAMINGHAM, MA – JULY 30, 2002 – A new report from IDC characterizes the softswitch market as a "high risk high opportunity" environment. According to the report, the current telecom downturn has created a substantial amount of risk for vendors, especially start-up companies that must have enough venture funding to outlast the so-called "telecom winter."

 

According to the report's findings, a number of formerly high-profile companies have already become market casualties, such as Salix (acquired by Tellabs), Transmedia (acquired by Cisco), Vsys, Tachion, Tundo, and others. However, IDC reports that despite the risk, the rewards for vendors who can make it through this early market cycle are substantial.

"Packetized voice is a disruptive agent of change, and end-game technology," said Tom Valovic, program director for IDC's Data Communications research. "There is enough volatility in the marketplace to create risk for players, but because of the size of the replacement base, this remains a great market opportunity for a wide range of vendors including IT suppliers previously not involved in telecom infrastructure."

Despite the severe economic problems in the telecom industry, IDC believes that the major drivers for large-scale softswitch deployment remain in place, including the benefits of new service provisioning, lowered purchase and operating costs, and the opportunity for carriers to design networks optimized for data.

IDC's recently published report The Softswitch Market Comes of Age: Worldwide Market Analysis and Forecast 2002-2006 (IDC #27565) provides a comprehensive overview of the worldwide softswitch market in terms of market dynamics, drivers and inhibitors; key vendors and their strategies; and the major applications being deployed. The report provides a five-year revenue forecast and offers revenues broken out by geographical region and by principal application including trunkside, lineside, and Internet offload.

About IDC

IDC is the foremost global market intelligence and advisory firm helping clients gain insight into technology and ebusiness trends to develop sound business strategies. Using a combination of rigorous primary research, in-depth analysis, and client interaction, IDC forecasts worldwide markets and trends to deliver dependable service and client advice. More than 700 analysts in 43 countries provide global research with local content. IDC's customers comprise the world's leading IT suppliers, IT organizations, ebusiness companies, and the financial community. Additional information can be found at www.idc.com.

IDC is a division of IDG, the world's leading IT media, research and exposition company.

 

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