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Feb 15

Diameter Signaling Controller Market Up 81 Percent in 2014 Driven by LTE

Confirmation that the Diameter signaling controller portion of the telecom signaling market is booming driven by LTE deployments is the subject of a new report from Infonetics Research. The Campbell, CA-based market research firm, now part of IHS Inc., reported that the Diameter signaling control market will grow threefold between 2014 and 2018, to $1.3 billion. 

This rapid growth of the controllers is not surprising.  The controllers are the core element for enabling Diameter signaling to securely handle the tsunami of mobile data traffic now inundating mobile networks.  They provide centralized routing, traffic management and load-balancing in IMS and mobile broadband networks. At a high level they are crucial of allowing mobile operators to not just handle the explosion of smart devices and their associated applications while providing great user experiences, but are also key to enabling the operators to rapidly launch and monetize new LTE services.

 “Developed as the next-generation signaling protocol, Diameter has begun to permeate networks, driven by increasing LTE usage and the emergence of VoLTE (voice over LTE). As a result, the Diameter market spiked 81 percent in 2014 from the previous year,” said Diane Myers, principal analyst for VoIP, UC, and IMS at Infonetics Research. Myers added: “The Diameter vendor landscape is beginning to shake out, and it’s a tight race at the top between Huawei, F5 and Oracle. We see a strengthening of Ericsson and a push from Alcatel-Lucent, Sonus and now Mavenir with its acquisition of Ulticom. The consolidation continues, and we expect even more in 2015.”

The report highlights include:

  • Globally, the Diameter signaling control market totaled $381 million in 2014, as noted this is an increase of 81 percent over 2013. 
  • The top use case for Diameter signaling control in 2014 was once again centralized routing, but roaming via DEA (Diameter Edge Agent) was right behind.
  • North America accounted for over a third of Diameter signaling controller revenue in 2014, followed by EMEA and Asia Pacific.
  • Growth in the regions is predominantly tied to rising LTE subscribers, however in EMEA, where there are many more operators; the need for signaling controllers for roaming is having an impact.
  • Infonetics looks for Diameter signaling controllers to be implemented as VNFs (virtual network functions) beginning in 2015, with North American operators and a few European mobile operators leading the way.

The robust projection of controller market growth is obviously a good indicator for LTE services growth going forward. They may be “network plumbing” but like water utilities you can’t monetize connections without being able to reliably connect the service and bill for it.  2015 is going to see a significant acceleration in 4G LTE deployments and the migration of customers from 3G to 4G as service providers look to streamline operations, provide differentiated quality experiences and capitalize on things like Voice-over-LTE and video services.  In short, the momentum of the past year does point to the market trajectory all aspects of telecom signaling will experience in the coming years.  

Source: Telecom Signaling