The drivers for the migration from TDM to IP are fairly straightforward. The trends toward IP networking have been happening for several years. What makes the migration critical is the acceleration in the adoption of services like VoIP, Unified Communications, HD voice and video, and cloud. In addition to what is happening today, IP will enable the future of machine-to-machine communications (M2M) and the Internet of Things.
While TDM remains the safe choice for delivering basic voice and data services, it is limited in its ability to enable new high performance applications and services. Carriers and service providers can’t afford to wait and see any longer. Future profitability and new revenue streams depend on IP networks.
Here are the six drivers we see for IP adoption:
- Widespread adoption of consumer and enterprise VoIP: Growth in revenue from consumer and enterprise VoIP remains strong and is expected to reach $88 billion by 2018, according to Infonetics Research.
- The rise of mobile data services combined with LTE deployments is creating growing demand for IP networks: Global mobile data traffic grew 69% in 2014, according to Cisco Systems. In 2014, mobile data traffic was nearly 30 times the size of the entire global Internet in 2000.
- IP networks enable new services such a cloud computing and M2M: Cloud computing and M2M depend on the flexibility and scalability of IP to meet their changing needs and the agility they require to be successful.
- Unified Communication services becoming more popular amongst Enterprise clients: Unified communications has gone mainstream and is showing double-digit growth in most regions of the world. For example, Unified Communications as a Service (UCaaS) is expected to grow with a 50.1% CAGR in the Asia-Pacific region from 2013-2018, according to Frost & Sullivan.
- HD voice and video to displace traditional conferencing services: HD voice and video have become a driver for loyalty and a way to reduce customer churn. They have also showed new ways for carriers and service providers to compete on quality and not cost.
- IP networks are more flexible and cost effective to operate than TDM: TDM was built to reliably deliver basic voice and data services but no longer matches the requirements of new services and new revenue opportunities for carriers and service providers. It is too rigid and inefficient to deliver the next generation of communications services and applications.
Carriers and service providers need to recognise where they are on their journey to an all-IP network so that they make each step as effective and efficient as possible. It is critical that they accelerate the migration from TDM to IP now so they can capture new revenue from IP services and realise the full cost benefits of IP networking.