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Ripple effect: iPhone 5 expected to help wireless infrastructure companies

Acme Packet CEO Andy Ory is one of the millions of Americans planning to buy the iPhone 5, a device he sees as a game changer for service providers and wireless infrastructure companies. “The iPhone 5 represents a strategic shift in the way service providers see their network,” says Ory. “The greatest changes in communication in our lifetime are the Internet and the mobile phone, and the iPhone 5 represents the convergence of both.”

Ory sees the iPhone 5 and other LTE devices leading service providers to invest in products like his company’s session delivery networks, which sit atop IP networks and provide session management and border control. “The service provider has to recognize the move from network to network [to] deliver the same serive as [customers] move,” he says. “This is where our session delivery network comes in. We make technology in the core that augments those edges.”

Managing traffic at the edges of networks has proven to be a challenge for operators as they roll out LTE. Analysts say LTE has created strong demand for Tekelec‘s diameter signaling router, a product which service providers may not have realized they would need until recently. “The original architecture for LTE didn’t include diameter signaling core,” says Joanne Steinberg, director of strategic marketing at Tekelec. “[Operators] thought they could manage traffic at the edge of the network, but they ran into signaling storms…outages and congestion.”

Tekelec says it now has 19 customers for its diameter signaling core, and analysts estimate that the company has at least 75% of this growing market, a market Steinberg says could surpass half a billion dollars by 2015. Tekelec recently released a report forecasting that LTE diameter signaling traffic will grow three times faster than mobile data traffic over the next 5 years, driven largely by policy use cases and online charging. Diameter signaling is also key to circuit-switched fallback, which enables LTE users to switch back to 3G networks for voice calls.

“A lot of new signalling traffic growth is due to these new [LTE] devices,” says Steinberg. And LTE traffic is sure to surge with the introduction of the iPhone 5. “It’s the difference between a frog in water being slowly heated and a lobster in a steaming pot,” says Acme Packet’s Andy Ory. His company also makes a diameter signaling controller and hopes to give Tekelec a run for its money in this market.

ABOUT AUTHOR

Martha DeGrasse
Martha DeGrassehttp://www.nbreports.com
Martha DeGrasse is the publisher of Network Builder Reports (nbreports.com). At RCR, Martha authored more than 20 in-depth feature reports and more than 2,400 news articles. She also created the Mobile Minute and the 5 Things to Know Today series. Prior to joining RCR Wireless News, Martha produced business and technology news for CNN and Dow Jones in New York and managed the online editorial group at Hoover’s Online before taking a number of years off to be at home when her children were young. Martha is the board president of Austin's Trinity Center and is a member of the Women's Wireless Leadership Forum.

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