Imagine a world in which only customers of one service provider could only talk with other customers of that same provider because carrier networks were not interconnected. Unfathomable, yet without network interconnection agreements this could be the case. Developing Telecoms looks at the absolutely crucial role of Next-Generation Networks (NGN).
Traditionally, for carriers to enable network interconnection, individual service agreements would have to be negotiated with each service provider they want to connect with-a process that is both complex and costly.
With the emergence of IP, network interconnection has become even more complicated, needing to be able to support existing legacy TDM infrastructure together with a next-generation IP-based network. Carriers with green-field IP migrations also require quick time to service offerings that benefit customers and the associated revenue also need to simplify interconnection.
Providers are building NGNs in order to offer differentiated services in a cost-effective manner. This is especially important in emerging markets, in which subscriber pricing must be kept affordable both for competitive reasons and to lessen "Digital Divide" issues. Once the NGN is deployed, it opens the door to enhanced services that are access platform agnostic and can run over copper, fibre, DSL, 3G and WiFi access technologies, for example. In order to offer these services successfully from traffic and billing perspectives, carriers need to put into effect interconnection agreements and wholesale arrangements that are economically efficient. If interconnect agreements fail to cover costs then providers will be unable to make the necessary investments needed to offer high-quality services, while maintaining network reliability, along with the ability to offer QoS, ease of provisioning and lower OPEX within a competitive, fast-growing telecommunications market.
There is fierce competition for business in the rapid growth markets in Asia and elsewhere, despite misconceptions to the contrary. Competition comes from new network-based carriers as well as providers that separate services from transport and ride "over the top" of broadband networks. In markets such as India, the fastest growing telecommunications market in the world, competition forces price compression and feature innovation. The market is also helped by reduced regulation and a growing middle class with increased interest in and money to spend on services and devices. In China, the government, through state-run businesses, is investing in the telecommunications market. With a population of over 1 billion people, there is market opportunity in China, especially in rural areas where teledensity is lower. Due to economic reform, citizens have more disposable income with less going to necessities, and more available for telecom services.
While the majority of networks in Asia-Pacific are TDM-based, the demand for IP is growing in Japan, Australia, New Zealand and Singapore where aging copper plant will not be able to handle newer bandwidth-intensive services, such as video, IPTV and triple-play bundles. In Japan and Australia, there is particular demand for hosted IP telephony and IP PBX deployments for business customers who want to reduce their own costs while adding functionality. Moreover, half the world's mobile subscribers are in Asia and carriers are migrating to 3G networks that require interconnecting.
Carriers in these regions and globally must balance revenue opportunities associated with the growing market demand and the need to keep costs low in order to meet the margins necessary to offer low-priced services that will attract and keep customers in an increasingly competitive market.
As carriers migrate to IP networks, the complexity required for interconnection with other operators has grown dramatically. These carriers are simultaneously supporting both new IP and existing TDM infrastructure and interwork services provided via both TDM and IP networks (eg, VoIP and traditional TDM voice). Service providers are required to negotiate individual agreements with every other service provider with which they wish to connect. Consequently, the carriers have used a mix of architecture and strategies for interconnection, which have proven to be complex, costly and difficult to scale.
While interconnection is an issue for all service providers, Asian mobile and fixed line operators are experiencing rapid subscriber and traffic growth as they deploy 3G networks. In this environment, efficient inter-carrier connectivity that addresses existing legacy and 3G mobile as well as fixed networks is critical.
In response to these various interconnection needs, the GSM Association (GSMA) has defined and carriers are now testing a new standardised service-IP Packet eXchange (IPX)-that offers a standardised architecture for interconnecting GSM and CDMA mobile operators, fixed networks and application service providers.
Specifically, the IPX is a service-aware, global, private IP network that provides end-to-end quality of service and cascaded billing features in support of interconnect and roaming services. IPX may be implemented by any number of providers to form a fully interconnected, global IPX domain (see figure 1).
IPX is an outgrowth of the GSMA's existing GPRS Roaming Exchange (GRX) service used to interconnect only GSM service providers' GPRS data networks. IPX goes beyond GRX to enable interconnection between 2G and 3G GSM, CDMA and fixed line as well as connectivity to application service providers. The IPX also takes GRX one step farther by supporting a wide variety of charging schemes such as originating party pays, terminating party pays, revenue share, volume-based, event-based.
In sum, IP interconnection is key to enabling carriers to benefit from NGN, but to do so there must be standard ways of passing traffic and billing for the exchange. IPX architecture offers a secure IP-based platform for interconnecting mobile and fixed operators. Vendors such as Veraz Networks are offering comprehensive end-to-end IPX-based architectures that will enable service providers to utilise interconnection in economically efficient ways while serving a growing customer base.
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