Everyone knows smartphones and bandwidth intensive applications such as peer-to-peer, video and gaming are driving change and investment in the industry in order to grapple with the bandwidth demands. But the latest report on the topic from Analysys Mason’s Patrick Kelly and Glen Ragoonanan shows that while much of that investment is going into single-function policy management systems and deep-packet inspection technology that provides more effective traffic prioritization and network enforcement capabilities, policy management software systems will evolve into a multi-function solution that supports subscriber management as well as policy and charging control.
Policy management also will evolve into a much bigger market – and fast. Analysys Mason said the overall policy management market will grow from the $876 million it was in 2008 to $2.62 billion in 2013. That’s a compound annual growth rate of 27 percent.
Kelly said Analysys Mason divides Policy Management into three categories: DPI, next-gen subscriber management and real-time charging systems. Subscriber management will experience the largest growth, expanding from $321 million last year to $1.1 billion in 2013.
In pulling the report together, Kelly said he was hoping to achieve a little debunking. “Everything you read in the press about policy management seems to be focused on DPI,” Kelly said. “I want to take a broader view and say that there is a lot more going on.”
Much of what’s going on deals with the issues beyond bandwidth management and the emergence of solutions around the other two segments while traditional DPI appliances, built primarily for traffic management, get subsumed into the core switching and routing infrastructure as embedded technology.
“Black box DPI suppliers have tackled this specific problem around traffic management and how to identify traffic types and types of users and the kinds of applications consuming the bandwidth,” Kelly said. “But you need to have policy management systems that tie into the billing and charging systems so that different types of services can be provided to different types of customers.”
Analysys Mason said the phenomenal growth in policy management is worldwide and cuts across market and technology segments. It is being driven by such diverse needs as compliance with roaming regulations to targeted advertising. And spending might even be greater if the regulatory environment for DPI was more settled. Service providers are convinced of the business case, but as Kelly said, “The rules are not clear and when there is regulatory uncertainty, there isn’t a lot of investment in the marketplace.”
The report includes case studies of from Internet Service Providers, triple-play providers, Tier 1 service providers and mobile providers (mostly outside of North America where service providers are less close-mouthed about policy management and DPI) using these technologies in various ways: to control bandwidth and in turn price controls, controlling P2P traffic, threat protection and personalized marketing.
To read the full, in-depth article on our sister site, Billing & OSS World, click here.
