Over 1.83 million IP-only PBX lines were sold in 3Q07 generating revenues of over $182 million during the quarter. Cisco was the overall market leader.

Among the non-Cisco shipments in the category, Mitel emerged leader with 36% market share, followed by ShoreTel.

North America accounted for nearly 71% of the pure IP PBX license shipments during 3Q07, followed by EMEA. Shipments to CALA and Asia-Pacific were not substantial during the period.

Please note that effective 1Q07, iLocus has discontinued coverage of shipments related to legacy PBX upgrades or the hybrid systems. We focus on only the pure IP PBX shipments in the enterprise VoIP equipment quarterly tracking service.

Here are some of findings from 3Q07 minutes data survey:

• Service providers worldwide recorded an estimated traffic volume of 328.7 billion VoIP minutes during 3Q07

• Split: 72.3 billion local, 232 billion national long distance (nld), 24.4 billion international long distance (ild)

• Local split: 69.1 bn is retail VoIP, 3.2 is wholesale local VoIP i.e white labelling

Continue reading "VoIP clocked 328.7 billion minutes in 3Q07" »

According to our estimates, in Q3, there was an aggregated total shipment of 259 thousand IP media server ports shipped by independent media server makers. North America accounted for majority of the deployments in 3Q07. CALA saw some ramp up during the quarter. An estimated $14.9 million was generated by the IP based media servers in the carrier segment in Q3, which is down by about $2.5 million or about 14% decrease compared to 2Q07.

Cantata merger with Dialogic could be one of the reasons for this one-off decline. Although IP Unity media server shipments grew substantially, Radisys, the leader in this segment did not show much increase its shipments as compared to previous quarters.

Service Provider VoIP Media Gateway revenue during 3Q07 touched an estimated $150.6 million. That represents q-o-q growth of 3.6%. A total of 6.54 million ports capacity were shipped during 3Q07.

By the number of ports, Sonus led the market with 23.7% market share worldwide, followed by Cisco and Huawei at number 2 and 3 respectively. Sonus also emerged market leader in high density gateways.

Cisco led the low/mid density gateway market, while Huawei emerged market leader in the access gateway segment.

iLocus coverage of Service Provider VoIP Media Gateway excludes upgrades to legacy switches. We focus on only the true next generation VoIP network equipment, which includes (1) new Greenfield VoIP deployments, (2) replacement of legacy switches with VoIP, and (3) extension of existing legacy networks with VoIP equipment.

Session Border Controller (SBC) revenue during 3Q07 was up 9% from the previous quarter 2Q07. A total of 5.2 million ‘sessions’ capacity were shipped during 3Q07 generating $45.1 million in revenue. 2Q07 revenues were in the range of $41.3 million for the segment.

Acme Packet leads 3Q07 SBC segment with market share of 54%.

Vendors who are making significant inroads into the SBC market include Covergence and Cisco. NexTone shipments saw high growth in session capacity shipped. Huawei SBC shipments have not ramped up yet. Embedded SBC capability offered by Sonus, Thomson, Nortel and others have not scaled up yet.

Total SBC units sold during the quarter (server units) was estimated at 959. This excludes the embedded SBC ‘ports’ tracked separately.

Nextgen Class 4 softswitch lines revenue during 3Q07 was up 9% from the previous quarter 2Q07. A total of 4.87 million lines were shipped during 3Q07 generating an estimated $90 million in revenue. 2Q07 revenues were in the range of $73.7 million for the segment.

On an individual basis, vendors who improved significantly upon 2Q07 in Class 4 softswitch segment were NSN and Italtel. For the rest of the market, growth was rather flat, with some of them showing a slight decline in shipments.

Sonus leads 3Q07 Class 4 softswitch segment with market share of 31.8%. Sonus also leads the North America region, NSN led the EMEA market while Huawei leads APAC region.

Continue reading "Class 4 softswitch revenues up 9% in 3Q07" »

In 3Q07, vendors shipped a total of about 7.3 million VoIP Subscriber Feature Server licenses for deployment in service provider networks, generating $131.5 million in revenue. The number of lines is up by a massive 78% Q-o-Q. And it is all due to high VoBB activity in Europe and among Cable MSOs in North America. In Asia-Pacific VoBB growth is still confined to Japan mostly.

This high growth in subscriber lines equipment defies the otherwise slow overall carrier VoIP equipment growth, and further indicates that the VoBB option among various edge packetization options is growing much faster in the voice world as compared to other options such as the switch augmentation or upgrades to the legacy TDM switches.

On the other hand the results also point at the volatility in VoBB equipment demand. This segment of VoIP market has not really settled yet. Overall revenues and shipments remain unpredictable which is the reason for delayed IPOs for some of the players involved.

In 3Q07, Nokia Siemens Networks (NSN) led the VoIP subscriber lines equipment market on a worldwide basis with a market share of 19.5 percent. That lead is followed by Italtel at number 2 and Cisco at number 3 worldwide.

Continue reading "VoIP subscriber lines equipment market grows 78% Q/Q" »

Service Provider VoIP business update
• MGX represented two-thirds of media gateway ports shipment

• Slightly lower total port shipments compared to 2Q07 due to seasonality

• 170% y-o-y growth in port shipments in Latin America

• Wireless: Several new customer wins in Trunking and VTN (PGW and Italtel SS).

• SBC: New customers with transcoding application with GSR 12K

• New customer names revealed: Winncomm(Russia), Waird Telecom (Pakistan), Flexcom (Croatia), Mude USA (US), IDEA Cellular (India)

Enterprise VoIP business update

Continue reading "Cisco 3Q07 VoIP update" »

• Reported revenues of over $18.9 million for the quarter. All sales are direct. Shipments predominantly to North America

• During the quarter MetaSwitch announced 2 new customers. Total number of service provider customers as of 3Q07: 280.

• Merged with applications division of parent company Data Connection. Total number of customers after merger: 320

• Passed 500 platforms deployed. Nine of the top 50 ILECs have deployed MetaSwitch’s softswitch. MetaSwitch announced it has over 100 CLEC customers in North America

• Total shipments of Class 5 switching capacity passed the 10 million subscriber mark

• 3Q07 revenues $211 million, up 2% q-o-q. Over 2.5 million lines in service at end 3Q07. Added 78k new lines during 3Q07. ARPU: $28.24 down from $28.38 in 2Q07.

• Took $145 million charges for patent litigation settlements: $11 million 3Q07 royalty to Verizon, the rest $134 million splits into $70 million for Sprint, $33 million for Verizon, $29 million to AT&T, $2 million for other minor settlements.

• Marketing costs: $62m down from $68m in 2Q07. Subscriber acquisition cost reduced to $206 per subscriber. Customer acquisition cost has been around $280 average over last 4 quarters. Vonage is shutting down poor performing marketing channels. TV and online marketing will be the main areas of spending going forward. New TV ads are generating better results according to the company.

Continue reading "Vonage 3Q07 Update" »

• 3Q07 revenue $153.6 million, down from $155.6 million in 2Q07. Wholesale revenue $121.6m (down from $127.8m in 2Q07); Retail revenue $32m (up from $27.8m in 2Q07). iBasis net income for the quarter: $0.2 million.

• Ended 3Q07 with 637 wholesale customers compared to 636 customers at the end of 2Q07. Out of the wholesale customers, 75 are consumer VoIP service provider customers.

• Traffic carried: 3.7 billion minutes, up from 3.5 billion minutes in 2Q07.

• Average revenue per minute 4.20 cents, down from 4.41 cents in 2Q07. Average cost per minute 3.71 cents.

• Cash balance as of September 30, 2007: $58.7 million

• Merger with KPN GCS: Here is the comparison of ‘before’ and ‘after’. iBasis is the legal acquirer, KPN GCS is the ‘accounting acquirer’ since KPN owns majority stake in iBasis now. KPN paid $55 million for 51% in the combined entity.

3Q07 VoIP revenues $19.4m, a decline from $21.4m in 2Q07. Veraz stock suffered a massive 44% decline yesterday, the biggest decline among all stocks on Nasdaq on Wednesday. The marginal decline in VoIP revenues was due to volatility in expansion orders. VoIP revenues from existing customers decreased from approx $16m in 2Q07 to $8m in 3Q07.

In 3Q07 more than half of the VoIP revenues came from early stage NGN projects from five new service providers. Early stage NGN projects typically carry lower gross margins than expansion sales. There is usually 2X to 3X sales related to follow on orders within 18 to 24 months for an NGN deal according to Veraz.

70% VoIP ports shipped to wireless providers in 2Q07. “Fairly similar” breakdown for 3Q07. Contract signed with wireless carrier in Brazil which is yet to be announced. Veraz now has 22 wireless customers for packetized wireless trunking, four of whom have been announced. The type of traffic these wireless carriers are shipping over Veraz platform includes switched and unswitched packetized voice, and SS7 backhaul.

Continue reading "Veraz Networks 3Q07 Update" »

• Estimated number of OneFlex VoBB subscribers: 150k to 190k

• VoIP minutes handled during 3Q07: between 9.5 billion to 10 billion minutes (nearly all internal long distance and carrier wholesale voice traffic). Our estimates are Qwest handled about 28 billion minutes of long distance voice traffic in 3Q07, about 35% of which is VoIP now.

• Access lines lost: 682k consumer, 97k business, and 226k wholesale local voice lines lost from 3Q06 till 3Q07. If a third of those is to VoIP (other two-thirds being shared by mobile and cable), then it seems like Qwest is losing around 80k access lines to VoIP each quarter.

Continue reading "Qwest 3Q07 VoIP Update" »

Added 30 new service provider customers during the quarter. Acme Packet is now deployed at 450 service provider customers worldwide. That includes 79 (up from 76 end of 2Q07) of the top 100 largest tier ones in the world. Deployed in 85 countries now.

Revenues $29.6 million, increase of 9% sequentially. Net income $5.5 million. 81% gross margins. $127.8 million cash balance as of 3Q07. Raising business outlook for 2007. Revenue forecast for 2007 now $112 million to $113 million. Q4 revenues expected to be between $30.5 to 32m.

Increase in 3Q07 revenues due to higher sales in Europe and increased indirect sales channels. Indirect sales accounted for 64% of the revenue reflecting Acme Packet’s growing strength in Europe. Customers accounting for 10% revenues or more: Nokia Siemens Networks, Alcatel-Lucent, and Ericsson. These three generated 46% of 3Q07 revenues. 40% of revenues came from North America, 60% international. The company sees softness in North American market.

Continue reading "Acme Packet 3Q07 Update" »

• Line reduction during the quarter: 247k lines. 21% of those lost to VoIP.

• Added 53k new VoIP subscribers during 3Q07. Total subscribers: 790k

• VoIP subscriber base represents 38% penetration into broadband accounts

• Netherlands VoIP market: KPN 790k subscribers; Cable 980k subscribers; Others 260k. Total around 2 million subscribers.

• KPN adding 10k new VoIP subscribers per week. Expecting that to go down to 8k per week over the next quarters

Continue reading "KPN 3Q07 VoIP and IPTV Update" »

• Fixed line reduction during the quarter: 16k consumer lines and 3k business lines. VoIP service launch is a recent development. Estimated subscribers: not more than 30k

• 3.8m ADSL subscribers. 378k FTTX subscribers

• 358k IPTV subscribers. Net additions during the quarter: 24k

• “3.9% Local revenue decrease and the 7.2% Domestic Long Distance revenue decrease, mainly due to mobile and VoIP substitution”

• Access line reduction of about 588k during the quarter. Some of that is VoIP substitution. Majority is mobile substitution. There is also some migration within AT&T’s fixed line to AT&T’s cellular services. The company added near about 2 million new mobile customers during the quarter

• Reduction in business voice lines during the quarter: 190k. Line reduction due to IPPBX and hosted VoIP, and other competitive factors

• CallVantage VoBB subscribers: not sure about the number. If they have 13 million broadband subscribers, 10% of that is around 1.3 million. So if we are talking about 10% penetration, AT&T might have over a million VoBB subscribers. That seems very unlikely though. One correction to our 2Q07 post on AT&T: the company uses Sylantro for business VoIP, and not for consumer VoIP. For consumer VoIP (CallVantage) AT&T uses its home grown solution.

Continue reading "AT&T 3Q07 VoIP and IPTV Update" »

• Legacy switch revenues continued to decline. NGN revenues not large enough to plug that hole

• Acquired Tamblin, developer of interactive TV programming and advertising for IPTV

• NGN wins during the quarter: Hits Telecom Uganda for a Mobile NGN solution; Mongolia’s Mobicom for a nation-wide NGN network, including softswitches and gateways; and Polish operator Exatel SA for an IMS platform.

• IPTV wins during the quarter: SingTel and Shanghai Telecom

• Enterprise solutions: IP usage penetration rates increased, reaching 43% year to date, versus 36% for the same period in 2006.

• VoIP subscription revenue $10.6 million, an increase of $0.8 million from the previous quarter.

• VoIP subscribers: Customers 2,340; Stations 56,966, Sites 4,035

• VoIP ARPU: Customers $1,665; Stations $62; Sites $926

• $3.6 million spent as on-going expenditures related to Covad VoIP services, which is being funded with the proceeds from the strategic agreement with EarthLink

• 3.485 million VoBB subscribers in France as of end 3Q07. Added 468k subscribers during 3Q07

• VoBB subscriber base represents about 37% ADSL customer accounts

• 700k VoBB customers outside France (mainly in the UK). Poland: 96k VoBB subscribers

• IP TV Subscribers: France 975k, Poland 23k, other European countries 18k

• Orange Unik FMC subscribers : 468k users, up from 300k users at end 2Q07

• Estimated VoIP traffic carried during the quarter: 4.2 billion minutes

• Added 662,000 VoIP subscribers during the quarter. Total VoIP subscriber base close to 3.7 million

• During the nine months ended September 30, 2007, the company added approximately 1.9 million VoIP subscribers.

• 3.7 million VoIP base represents 9% penetration of the total Comcast addressable market

• VoIP service now marketed to 40 million homes representing 83% of Comcast's footprint

• Phone revenue $472 million in the third quarter of 2007. The increase in phone revenue was partially offset by a $57 million or 53% decline in circuit-switched phone revenue as Comcast transitions to marketing only VoIP in most areas.

• 12.9 million high-speed Internet subscribers as at the end September 2007

• Total users 246 million, up from 220 million at the end of 2Q07

• Revenue: $98 million, up from $90 million in 2Q07

• SkypeOut minutes (PC-to-Phone): 1.4 billion, up from 1.3 billion during 2Q07

• Call volume on Skype-to-Skype (PC-to-PC) has dropped from 7.1 billion in the previous quarter to 6.1 billion in 3Q07

• Revaluation of Skype down to $2 billion. Search on for new CEO

• Moving forward, focus on expanding feature set, better integration with partner assets, and accelerated investment to induce more user engagement