VoIP Has Just Begun

Andy RandallVP of Marketing, MetaSwitch

O C C A M N E T W O R K S U S E R C O N F E R E N C E , S E P T E M B E R 7 – 1 1 , 2 0 0 8

Broadband & VoIP Subscriber Growth

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50

02 03 04 05 06 07 08 09 10

DSL

VoIP

Why Voice over IP?

More

Flexible

More

Flexible

More

Efficient

More

Efficient

++ ++More

Reliable

More

Reliable

More

Reliable

More

Reliable

Why Voice over IP?

More

Flexible

More

Flexible

More

Efficient

More

Efficient++

OpExOpEx

Revenue,Revenue,LoyaltyLoyalty

The First VoIP Wave: PC-to-PC

1995: Microsoft

introduces NetMeeting

10 million

Xbox Livesubscribers

Source: Microsoft, July 2008

The Second Wave: PC-to-PSTNThe Second Wave: PC-to-PSTN

$1.9billionlost to Skype

Source: iLocus, March 4, 2008

0.03%Proportion of Skype users who use it as

their primary home phone

Source: Yankee Group

The Third Wave: Over-the-TopThe Third Wave: Over-the-Top

May 19, 2005: “we require providers of interconnected VoIP

service to provide E911 services to all of their customers”

Vonage Net Subscriber Additions

0

50

100

150

200

250

300

350

1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 4Q07 1Q08 2Q08

2,000

Source: Vonage SEC filings

The Fourth Wave: Managed VoIP

The Fourth Wave: Managed VoIP

10 millionTelco phone lines switched to cable

VoIP since the last Occam user’s conference

3.3Millio

nFTTH

households

3.3Millio

nFTTH

households

Source: FTTH Council of North America, July 2008

The Next Battleground

Source: Heavy Reading, Cable vs. Telcos, July 2008

“We have a market opportunity that rivals the size of our core video business”- Bill Stemper

President, Comcast Business

4-year goals:

•20% market share

•1 million business customers

•$3 billion revenue

Source: Heavy Reading, Cable vs. Telcos, July 2008

4-year goals:

• 20% market share

• 1 million business customers

• $3 billion revenue

38%Growth last quarter

Source: Comcast Q2 2008 Earnings Call

Wave 5: Convergence

Convergence Applications

Users value

• Simplicity

• Seamless connectivity

Convergence: Phone + Web

Web 2.0 APIs Enable Voice 2.0 Services

Web 2.0 APIs Enable Voice 2.0 Services

The Browser is Becoming a Powerful Application Environment

Convergence: Phone + TV

Calling…Calling…

Convergence on the Phone Screen

Voicemail

Call Lists

Contacts

Conferencing

Text messaging

…

Convergence with Speech Recognition

Convergence

Managed VoIP

Over the top VoIP

PC-to-PSTN

PC-to-PC1995 2010

Five Waves of VoIP Services

Source: TeleGeography, September 2007

VoIP Services Have Only Just Begun

2005 2006 2007 2008 2009 20100%

10%

20%

30%

40% EuropeU.S.

VoIP Switching Has Only Just Begun

MetaSwitchMetaSwitch

CopperCom

CopperCom

TaquaTaqua Lucent/Telica

Lucent/Telica

Tekelec/SanteraTekelec/Santera

SonusSonus NortelCS2000Nortel

CS2000 CiscoBTS

CiscoBTS

NortelCS1500Nortel

CS1500SiemensSURPASSSiemensSURPASS

803

Source: LERG, March 2008

AXEAXE EWSDEWSD

GTD-5GTD-5DCODCO

DMS-10DMS-10

DMS100/200

DMS100/200

NortelRemotesNortel

Remotes

5ESS5ESS

All softswitchesAll soft

switches

VoIP Switches Have Only Just Begun

Source: LERG, March 2008

IMS-based Application Platforms

Class 5Replacement

Class 5 Augmentation

VoIP Gateways

Class 4 Replacement / IP Tandem

VoIP in the Carrier Network Core

What does this mean for my network?

IP transport

IP call control

IP applicationserver platform

VoicemailFMC

Web portalVideo messaging

Conclusions: Like Broadband…

VoIP is here to stay

Conclusions: Like Broadband…

VoIP is here to stay

VoIP services are evolving

Conclusions: Like Broadband…

VoIP is here to stay

VoIP services are evolving

VoIP service delivery architectures will evolve

VoIP is here to stay

VoIP services are evolving

VoIP service delivery architectures will evolve

VoIPhas just

begun

Conclusions: Like Broadband…