Huawei will put a new IPTV Set-Top Box chipset in commercial use towards the end of this year. The chipset is supposed to bring down the cost of IPTV STBs to an affordable level. In its second design iteration, the new solution will also cater for HD. The average cost of an IP STB in China right now is slightly less than $100. Outside China, the cost shoots upwards of $170 to $190.

IP STB forms the biggest cost component from deployment perspective and reduction in cost is certainly welcome as far as the operators and end users are concerned. Huawei will limit the usage of this new STB solely within its IPTV partners in opportunities where Huawei is the prime stakeholder.

Flash phones were supposed to be hot this year. The market has instead seen only four players so far: Ribbit, TringMe, flashphone.ru, and this startup I came across yesterday - Indafon. I guess Ribbit’s successful exit might speed up the Flash side of VoIP. Anyway, Hungary based Indafon has had about 50,000 users trying its product in Hungary. The company is now targeting a global audience for the next stage of its trial.

As far as VoIP development within Flash environment is concerned, one of the biggest challenges is to maintain call quality when connecting a Flash player with PSTN networks. There are problems related to codecs, for instance. Flash is not open to some of the codecs. Adobe is beta testing Flash Player 10, the new Flash media server. This one is expected to support real-time voice and video transfer more adequately. Adobe is also sorting out the codec issue.

• 508k IPTV subscribers. Net additions during the quarter: 73k. Number of subscribers increased 29% q-o-q
• “2.3% Local revenue decrease and the 5.6% Domestic Long Distance revenue decrease, mainly due to mobile and VoIP substitution”.
• 4.3m broadband subscribers (including ADSL and FTTB) at the end of the 2Q08. 3.5m ADSL subscribers, 782.4 thousand FTTX subscribers.

• PCCW's installed base of IPTV subscribers reached 927k, an increase of 13% from a year earlier.
• The IPTV offering has further boosted its content line-up to more than 160 local and international channels at the end of 2Q08.
• The UEFA EURO 2008 had attracted new customer subscriptions to the Mega Sports Pack.
• Introduction during the quarter of the All-In-One Set-top-box with HD and digital terrestrial television during 2Q08.

• 3.13m broadband subscribers as of end 2Q08. Added 508k subscribers during 2Q08.
• In theory, same number of VoIP customers (i.e. 3.13m). Estimated IPTV sub base: 2.8m
• Free had 2.6 million unbundled subscribers at the end of the quarter. 83.4 % unbundled subscribers at the end of 2Q08.
• Introduced New Generation WiFi 802.11n during 2Q08
• Canal + Group Catch Up TV service available for the first time on TV during the Quarter.

• 80K IPTV subscribers.
• Added 16K new subscribers during 2Q08.

• Korea Telecom had 707k MegaTV IPTV subscribers at the end of 2Q08, an increase of 139k during the quarter.
• MegaTV IPTV revenue during the quarter was $9.6 million U.S., up from $5 million U.S. in 1Q08.

• 800k IPTV subscribers as of end 2Q08. Added 100k subscribers during 2Q08.
• hanaTV IPTV revenue was KRW 82 billion in 2Q08.
• Hanarotelecom has achieved a market share of 9% through strengthened VoIP.
• Wireline operators launched TV Portal services to prepare for the commercialization of IPTV.

Vivox is planning to open up its platform to third party developers. Vivox provides a VoIP platform for developers of online games and virtual worlds. The first round of apps that the company expects from its developer partners include wide ranging features from lip sync to natural language speech recognition and response. There is also interest among developers in porting the code to different mobile platforms to enable users to connect to their communities from multiple devices.

Vivox provides voice services to a number of games and virtual worlds including CCP Games (Eve Online), Linden Lab, Sony Online Entertainment (Everquest, Everquest II & Star wars Galaxies), Wizards of the Coast, Multiverse, NCsoft and K2 Network. As the network provider to these companies, Vivox serves over 5 million users. Currently the company offers premium services that are often sold directly to end users and include things like voice fonts which give players the ability to morph their voice to match their avatar, i.e. an elf.

• 745k subscriber lines.
• Net additions were 41k for the quarter, of which approximately 13,000 were migrations from the circuit-switched platform.
• Cable’s Internet subscriber base at the end of the quarter was 1.5m.

When I first looked at VoIP I thought it was a great technology to reduce your ISD bill. What was the first thought that crossed your mind when you first stumbled upon VoIP technology?

Back in 1996, there were a handful of VoIP products in the market. It wasn’t really an industry. So you could not envision all the other pieces in the puzzle. But you got the sense that it was a new way of communications. By 1997 we had decided to start a magazine in this space called Internet Telephony that has been dedicated to VoIP only. So we thought this was going to be big.

Did you work with the first generation VoIP vendors?

Absolutely. We worked with companies like Vocaltec, Dialogic, Natural Microsystems and others. Strangely enough, Microrsoft also entered the market early with their Netmeeting. You would not expect them to enter the market that early. That further cemented the feeling that VoIP was going to change communications.

And then nothing happened in the area of Netmeeting for a long long time. In fact nothing in the area of VoIP from Microsoft up until the recent introduction of OCS.

The people that I spoke within Microsoft tell me that they shifted a lot of people from VoIP projects over to Internet services side. And they have become a leader on that front. Some three years back they realised that there was an opportunity in communications on the enterprise side. So they re-invested in the communications.

VoIP has been reasonably disruptive. But VoIP architecture itself has evolved quite a bit over the years: from monolithic boxes to softswitches to IMS and further onward to Voice 2.0. What do you envisage to be the impact of VoIP from here on? How can something evolve and yet be disruptive at the same time?

7.7 million VoIP access lines shipped during the quarter, down from 7.9 million lines in 1Q08. This represents second sequentially quarterly decline from 4Q07. Of the 7.7 million lines shipped during the quarter, estimated 6.8 million went towards residential VoBB. The remaining were deployed as IP Centrex lines.

6.8 million Class 4 VoIP softswitch licenses shipped during the quarter, down from 7.1 million in 1Q08.

8.9 million service provider media gateways ports shipped during 2Q08, up significantly from 8.1 million ports in the previous quarter

5.2 million SBC sessions capacity shipped in 2Q08, down from 8.9 million in 1Q08. Revenue, however, did now show such a depression Q-o-Q. Revenue decreased 1.3% sequentially.

Marginal improvement in IP media service business Q-o-Q

385.4 billion VoIP minutes handled by carriers during 2Q08. Breakdown: 23.3 billion ILD, 270.2 billion NLD, 91.9 billion Local.

(Source: iLocus 2Q08 quarterly reports)

Please note that iLocus does not track IP upgrades to TDM ports. We only track pure VoIP deployments which in the context of Class 5 NGN includes VoIP hosted telephony implementations (such as hosted PBX and VoBB), new Greenfield VoIP deployments, complete replacement of legacy switches with VoIP, and extension of existing legacy networks with VoIP equipment in new geographies.

For T-Mobile, it is ok to use WiFi in the US to offload voice traffic (sometimes without informing the customers), but in the UK it refuses to interconnect with Truphone and in Germany it altogether seeks a ban on VoIP over iPhone, whether the call is made over 3g broadband or WiFi. That sounds like more than double standards.

The German court has unfortunately sided with T-Mobile this time. In the UK, it did not have much luck though.

Mobile VoIP is actually not allowed fully in the US. You cannot use 3g mobile broadband connection to make a VoIP call. The wireless carriers are allowed to block such use. Only VoIP-over-WiFi is allowed. Indeed Apple has also sided with the wireless carriers in the US. It is allowing VoIP on its iPhone handset only as long as the call goes over WiFi.

I have been following this thread on Yahoo Message Boards today. A few lines about what this could mean for Sonus ...

So … Sonus has for a long time bet on hosted VoBB i.e. its vision of Class 5 VoIP has been that of an over-the-top voice over a converged broadband pipe. That was until the BT deal came along. BT vision says broadband and narrowband voice will co-exist for a long time. In terms of architecture that translates into a bridging technology, the one that bridges narrowband and broadband. As such you will find the Access Gateway + DSLAM kind of technology deployed in BT exchanges. If the customer is an over the top VoBB user, the voice hits the DSLAM direct. If the user is a narrowband customer, the voice is packetized by the Access Gateway in the same box before it moves over to DSLAM for IP dumping. The combined Access Gateway + DSLAM box technology is what they call MSAN.

So why am I pretending to be technical? Just to tell you that Sonus now has the hots for these MSAN type deployments. BT might not be alone in implementing this architecture. I think even France Telecom - that has over one-third of its landline users now subscribing to over-the-top VoIP - has realized that not all its customers will move away from POTS. And the regulation will never allow FT to ignore those that keep using POTS. Conclusion: use the BT model.

And therefore ….. what good is Sycamore as a merging partner for Sonus? Well, Sonus has the Access Gateway product and the Access Server. Sycamore brings in the access equipment for data. That means Sonus gets to keep all the money for the access POP that handles both data and voice access. Going forward, this access POP might be the only POP a telco deploys as Class 4 and Class 5 functions get integrated into a single server. So the merger makes sense. Besides, Sonus has been too conservative in terms of acquisitions. It needs to diversify in order to move ahead.

ENUM look up system is also part of the IMS blueprint. Are the IMS projects implementing ENUM in practice? Where are ENUM servers being deployed today?

Some of the IMS projects are becoming smaller due the present economic conditions. Public ENUM has gone by the wayside. But there are a host of new applications for ENUM server products. There can be wholesale applications like our deployment at Telus where our product is being used for arbitrage route plans. Having said that, we have a number of IMS wins. France Telecom is one of our larger ENUM deployments where they are using our solution along with NSN’s IMS solution. We see a lot of inside carrier federation projects where you might have multiple or heterogeneous softswitch environment. ENUM servers there are being used as aggregation point for route plan data. That data is then made available to softswitches and SBCs. So you provide one provisioning and aggregation point for route plan data and push that out to networking elements. When you do those type of projects you naturally look into LNP kind of possibilities. So the scope is vast in theory as well as in practice.

Could there be some overlap in functionalities i.e. an SBC or a softswitch subsuming some of the ENUM routing functionalities?

We could have some overlap in deciding where in the network the call routing decision is made, for instance. Other than that we don’t expect much overlap as different network elements evolve and scale as per particular functions. IMS could live or die. But one of the things it is going to teach us is how to architect new generation networks. IMS defines the specific roles of various different network elements and I think that is the trend we are likely to see.

I guess the prospects for your solutions depend upon the extent to which a carrier in the future wants to keep the control at the core of the network. When you have more and more intelligence migrating towards the edge such as a peer-to-peer scenario like Skype, what kind of role would your product be playing?

Your instincts are spot on. When I talk to carriers I tell them this is the platform that delivers control. What carriers realize is that the external services, such as the peering fabrics, are essentially there to provide layers of reliability, disaster recovery, backup and storage – things of that nature. There is a paradigm shift going on inside carriers. Only when the burden of managing the data that they want to manage internally becomes huge, only at that point will they go out to an outside service provider. At the same time, with centralized infrastructure, there are certain costs that can be reduced. For instance you can centralize LNP and centralize provisioning of multiple softswitches.

IPTV equipment sales in 2Q08 reached $229 million. The equipment sales tracked by iLocus include those of IPTV specific STB, Middleware, VoD, Encoder, and Security products.

IP STB formed majority of the sales generated. IP STB sales touched $146.8 million, down from $186 million in 1Q08. Motorola led the IP STB market with 36.4% market share during the quarter (by the number of units shipped). The total number of IP STB units shipped during the quarter was around 1.7 million.

As of the end of 2Q08, the total IPTV subscriber base worldwide is estimated at 17.8 million.

What is Jaxtr all about?

Our mission at Jaxtr is to enable new conversations by letting people link their phones to the web.

So the value you bring in is the integration of PSTN and web. What happens when people start to bypass PSTN more and more using broadband? You would then have to re-invent your business dramatically.

That scenario is way off. The cell phone companies are not going to go out of business anytime soon. But as the voice communication moves to IP more and more we will terminate sessions on IP device. That does not matter much to us. It is in fact cheaper for us.

But when most voice communication is IP to IP, it is likely to be Skypes and Gtalks and MSN Messengers of the world that would be on the minds of consumers. It will be difficult situation to compete in.

Not necessarily. Jaxtr offers a unified way of communications whether it is SMS or voicemail or real-time voice. Consumers prefer having one consistent communications identity.

Is that one consistent identity going to be the mirror number that you offer whereby users are able to keep their numbers private?

The consistent identity is the Jaxtr link. Numbers that get generated depend on the device you are calling from. So it is not the number that stays consistent. It is the Jaxtr link that stays the same. A mirror number is not so flexible when you are travelling. A link is much more flexible.

There is currently no forum out there that promotes partnerships among the three main parties in Voice 2.0: the operators, developers, and platform providers. While events like eComm have focussed on direct-to-consumer offerings, other event organisers have paid little attention toward this new ‘evolved voice communication’.

My personal belief is that Voice 2.0 startups alone will not re-invent voice communication. Viral marketing alone will not suffice, no matter how innovative the services. For an efficient distribution of new services and adequate monetization of those services, the industry requires partnerships among all three parties (mentioned above).

Forging those partnerships is the main purpose of our Voice 2.0 Summit. We welcome all progressive telecom professionals to the event. Details can be found here.