softswitch: an analysis of the Sprint decision to deploy it, from America's Network Magazine
"If it’s smart for Sprint… "
November 9, 2001
[FAC: It's helpful to keep in mind that the editorial orientation of AN is keyed to an incumbent telco following. As such, it doesn't go the distance in addressing the use of softswitch technology by other players such as the IXCs, MSOs, Wireless Carriers, ISPs, ITXCs (VoIP carriers), IOCs (independent operating companies), etc. Nor does it address the appropriateness of the technology as a next-cycle replacement vehicle for aging end office switches. In any event, I'm quite certain that this analysis is being waved in the faces of softswitch proponents within ILECs across the continent, as we speak. On another point, while I am usually conscious of the need for "battery and ground" on subscriber loops used for voice applications, I failed to identify this lifeline issue as a potential stumbling block for softswitch deployments. It'll be interesting to see how this aspect of future deployments is resolved, both within Sprint's local offerings and eslewhere.]
americasnetwork.com
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Is Sprint’s softswitch plan, announced this week, a sign of similar announcements to come? Not likely, say industry observers.
According to conventional wisdom, it will be a long time before incumbent local carriers convert to softswitches, simply because carriers have made huge investments in conventional switching equipment, which is depreciating over a period of many years. But Sprint’s local division has made an economic case for converting its entire Class 5 infrastructure to a Nortel softswitch architecture over an eight-year period.
The key drivers are lower cost to deploy and maintain softswitches and increased revenue streams from being able to quickly provision ADSL, frame relay and ATM, says Mark Chall, Sprint’s vice president of network packet switching. But if it’s as simple as that, why aren’t more carriers doing it?
A key component of Sprint’s strategy is to also replace all of its digital loop carriers with what Chall calls "line gateways." Such line gateways also will go in every central office, with about one in three central offices also receiving a call server, or softswitch controller. The line gateway will support POTS or DSL service and will convert POTS calls into ATM. (Ultimately, IP may replace ATM as the key transport mechanism.)
"There’s no difference between a line gateway in the CO or in the field," says Chall. "They’re all controlled by the softswitch."
Any other local carrier undertaking a softswitch conversion also would have to upgrade its access network, notes John Kuzma, senior analyst for RHK. Why?
"You can’t just replace POTS with a softswitch," says Kuzma, noting that unlike Class 5 switches, softswitches do not deliver power to end user devices. "Battery and ground are what’s holding back softswitches."
DLC remote terminals can solve the power problem, notes Kuzma. Presumably, Sprint’s line gateway does, too.
But Kuzma doesn’t expect RBOCs to make the required investment in their access networks to support a softswitch conversion any time soon. He notes that SBC’s Project Pronto, which involves a DLC upgrade, does not address POTS. "It’s just data and DSL," says Kuzma.
He also sees some uncertainties entailed in the Sprint announcement, noting that 2002 will be a trial period, with deployment not scheduled to begin until early 2003. "It’s not just a technology trial. There are still unknowns about the OSS–and they’re putting a lot of faith in Nortel to deliver."
Russ McGuire, chief strategy officer for Telechoice, also doubts that the RBOCs will follow in Sprint’s footsteps. "If the packet and voice switch players could convince the RBOCs that they could move more aggressively up from the consumer end of the market to the business market, that could be appealing. But I don’t see the RBOCs under pressure to save costs, and the RBOCs have never been about flexibility of new services."
So why is Sprint’s motivation any different? The answer is likely related to the fact that the company’s primary business is in the embattled long-distance market.
"Sprint is experiencing more pain regarding cost reduction," says McGuire. "And the company has always been an innovator."
Sprint may be looking for a replacement for its ill-fated ION strategy, suggests McGuire. The aggressive broadband plans now envisioned within its own local territories are much like what the company originally planned for larger markets outside of its own local region.
Sprint’s local division serves 8.3 million lines in 18 states. Explains Chall, "Today when we offer a new service, we have to roll it out to 330 different host offices." Under the new plan, the company will go "from 330 host offices down to 96 and hopefully fewer," says Chall. – Joan Engebretson
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