Service Delivery Platforms "fundamental to Telcos' Futures"

Communications market research firm Infonetics Research predicts in a new report that worldwide revenue from service delivery platform (SDP) software and integration services will grow at a 23% compound annual growth rate (CAGR) over the 5 years from 2007 to 2011.

The report confirms that while many SDP vendors are struggling to define and position their SDP products, demand for them by mobile and fixed line service providers is escalating rapidly.

SDPs develop, provision, and deploy new subscriber services across wireline and wireless networks by combining discrete services into compound services, reducing the time it takes operators to integrate new services from 2 or 3 months to about 2 weeks, the report says.

"Service delivery platforms are fundamental to telcos' futures. Without an upgrade to their service creation and provisioning process, telcos will quickly lose revenue to over-the-top Internet content providers like Google and Yahoo, making their enormous transport and access network upgrades obsolete. The demand for SDPs and outsourced integration efforts by major operators worldwide cannot be overstated," said Jeff Heynen, directing analyst at Infonetics Research.

Other highlights from the report:

• Fixed-line SDP revenue accounted for 16% of total SDP revenue in 2007; mobile SDP revenue accounted for 84%
• North America's share of the SDP market will jump from 16% in 2007 to 25% in 2010
• In the short-term, operators will use SDPs to help streamline the creation and delivery of basic services, including VoIP, ringtones, and steaming video services, and later to create mashups that compete with services offered by "Web 2.0" ICPs
• Continued consolidation is expected in this space, with larger integrators snapping up smaller software players to round out their SDP offering and make it end-to-end
• Motorola's acquisition of Leapstone and Oracle's acquisition of BEA have major implications for both the software and systems integration sides of the SDP market

Posted to the site on 4th June 2008