Next-generation switch vendors report interest in their products from rural telcos is increasing, as more independent telcos demand affordable GR303 interfaces to pass traffic to broadband equipment such as NGDLCs, and require switch upgrades to support local number portability. Also contributing to this upswing in activity in the rural market, equipment companies say, is Verizon’s recently announced move to accelerate its VoIP migration.
“It’s commonplace for rurals to talk about and install these [Class 5 switch alternatives] now,” says Michael S. Ward, senior vice president of sales at MetaSwitch. “And with the Verizon [VoIP deal with Nortel], more rurals are saying ‘Well, what are we doing?’ When the big telephone companies do it, it’s like an acknowledgement that it’s OK to do it.”
MetaSwitch this year has announced a handful of new customers, two of which are total switch replacements as opposed to the more common cap-and-grow deployments. To move on the new opportunities the improving market is delivering, MetaSwitch is beefing up its staff. The company, which now has 20 sales people in North America, planned to increase its sales and marketing team by 40 percent last quarter. “We want to move upstream to the Tier 2s,” says Ward.
Bob Kersey, vice president of product management and marketing at CopperCom, says the Verizon move “further validates the architecture.” That, and the other benefits of moving to next-gen switching — such as lower capital and maintenance costs and new features — have contributed to what Kersey notes as a recent increase in activity by rural telcos. “I’ve really seen more activity in the last six months in service providers in the rural space who are putting out various RFPs to vendors,” Kersey told xchange in mid-February. “That has spiked up significantly in the past six months.”
Rob Ennis, director of marketing for Tekelec’s switching division, says his company in late February had two or three RFPs from rural telcos. “This year’s been very active,” he says, adding that businesses started picking up in the third and fourth quarters. Ennis attributes that, at least in part, to a general belief that the economy is improving and telcos’ desire to use new technology in new housing developments, which is “the big thing I see in all this discussion about the triple play aspect,” adds Ennis. “The rural guys are looking to move beyond traditional voice. So they want to have platforms that can support more than just voice. Tekelec is a voice switch, but it has the ability to do data. We’re not going to be a router, but we can terminate various types of traffic, to do IP and ATM switching.”
With 24 new customers added in the fourth quarter of 2003 alone, Taqua — which Tekelec in late February announced plans to buy — almost doubled its revenue from 2002 to 2003, “but every order we got, our guys really had to scrape for because it was not in IOCs’ budgets,” says Jody Bennett, Taqua’s vice president of marketing. “That’s changing,” Bennett says, adding more rurals are now funding voice switch initiatives.
Of course, these next-generation switch vendors have moved into the rural telco market to fill what they see as an opening left by legacy switch vendors such as Lucent Technologies and Nortel Networks, which competitors say have been slow to address the industry’s interest in evolving to packetized voice. Competitors also say Nortel offers switch upgrades with GR303 and other functionality at a hefty price.
But Ron Kunkel, technical product manager for Succession Solutions at Nortel, says the company, which has sold its DMS-10 into the rural market for about 25 years, last October announced its plan to evolve the DMS-10 to support VoIP. The 601 software release for the DMS-10 to enable VoIP will be available in the middle of 2005, he says. “We may be late in expressing our VoIP message to rurals, but not to bring it to the market,” he says. “Against all conceptions, the rural market is not in a big rush to evolve to VoIP, but they do want to be ready for that,” he adds.
Many of the next-generation switch vendors recently have added support for IP voice or expect to add it in the near future.
Kunkel adds Nortel also is introducing a new peripheral to take call control into the packet environment to control IP gateways. It’s based on H.248 call control. And the company is bringing its Succession Communication Server (CS) 2000 to the rural market.
Kunkel notes, AFC has successfully completed interoperability testing between its enhanced AccessMAX gateway and Nortel’s Succession CS 2000. AFC’s new GPE plug-in card enables AccessMAX systems to use the H.248 media gateway control protocol to interface with Nortel Networks’ Succession CS 2000. The combined solution allows subscriber calls initiated from traditional analog telephones to be converted into packets and switched efficiently through a converged packet network.
