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Cellcos overcome SIP fears and VoIP over 3G set to dominate by 2012

By CAROLINE GABRIEL

Published: 6 December, 2007

READ MORE: VoIP

According to new figures from Disruptive Analysis, this boom will see VoIP over 3G users rising in number from almost none this year to over 250m by the end of 2012, eclipsing voice over Wi-Fi and leading to rising investment in carrier class VoIP systems, as cellcos seek to keep control of VoIP usage, rather than losing the customer to unlicensed Wi-Fi, or encouraging use of open VoIP clients like Skype. To date, European operators in particular have been wary of opening their networks too freely to applications like Skype, although some are working to bring such apps under their own control with versions optimized for their own handsets, an approach favored by 3.

Start-ups like Tatara Systems and Sonus have been betting on the acceleration of uptake of SIP -based services, well in advance of wholesale IMS deployments, and particularly that VoIP in the 3G core will be an initial step in this direction. They seem to be seeing their bet pay off, with larger players like Alcatel-Lucent joining the market, and operators like AT&T talking up their plans.

Traditionally, VoIP has used far more bandwidth than circuit switching, especially on the highly efficient 3G voice systems, but the latest network upgrades and the introduction of IMS make cellular VoIP as efficient as circuit switched in bandwidth terms. And there are advantages such as greater utilization of the spectrum, since voice is delivered as packets, rather than requiring a dedicated channel; lower operational costs; and better integration with other IP features, supporting premium add-ons such as instant messaging. Dean Bubley, founder of Disruptive Analysis, also points to the ability to reduce operating expenses by combining fixed and mobile core networks, and to use VoIP as the springboard to launch other new services like push to talk and voice-integrated mash-ups. VoIP over 3G is also a strong fit with the rising interest in extending the RAN, and improving indoor penetration and homezone schemes, by using femtocells within the home.

Operators will inevitably transition to IP networks in a few years' time - mainly LTE or Wi- MAX - but in the mean time, there is a pressure to act earlier, particularly in the laptop sector. Many carriers are now marketing 3G laptop modems as a more flexible alternative to a fixed home broadband line, and like that line, this option needs to come packaged with carrier branded VoIP, to increase the value proposition to the user without encouraging the strain on the network of high levels of Skype usage. By 2012, the report claims most VoIP over 3G users will be on mobile carriers' own standards-based VoIP systems, although a large minority - about 60m - will prefer independent offerings, many actually operated in partnership with cellcos.

"3G networks are increasingly capable of supporting VoIP, for both traditional mobile operators and independent internet-based VoIP challengers. But while CDMA operators will benefit from VoIP being 'designed-in' to their newest networks, 3GPP/HSPA operators will have to wait for several years - a window of opportunity which will be exploited by the 'over the top' players. Rather than competing head-on, partnership models have the potential to create win-win propositions," said Bubley.

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