The industry is not witnessing any acceleration in the end-office replacement. There is a lull in this regard worldwide. Service providers are going for VoIP overlaying more: either as completely separate service offering or in certain cases part of other IP offerings as in the triple play service offerings. That is not to say that legacy switches are not being replaced. They are being replaced but the speed of that replacement has not accelerated.
Replacement has slowed down for a couple of reasons. One of the reasons is that the service providers have decided to extend their broadband program by offering high bit rate DSL based services. Accordingly their plan is to upgrade their access gear. So they are replacing their older access gear or just copper pairs with FTTX.
The other reason is that telcos are seeing consistent line reduction. So in reality there might be no planned replacement of the legacy Class 5. Instead they are planning to roll out an IMS architecture and then migrate the user through the broadband/IMS infrastructure, and just let those legacy systems reside for an extended period of time for those end users that are not planning to migrate any time soon.
That is causing is little bit of discontinuity in the market. Vendors like Nortel that have a large installed base of such switches are bringing in the IP interface to the line cards and managing them through a softswitch core. So that is the trend we might continue to see over the next 24 months. As such vendors like Nortel and Siemens will have a steady demand for their migration portfolio for quite some time.
So again - if the switches are relatively new and the ROI is important then service providers are adding the IP interfaces. In addition, they are in parallel putting up the IMS infrastructure that does not touch the legacy network. It is an overlay IMS or a parallel IMS network. That parallel IMS network for service providers is in essence the voice over broadband network for now.