It may not be moving quite as fast as it was in 2011, but the policy and DPI express train is still rolling along nicely, according to the latest edition of our Policy Control & DPI Market Tracker – and it's taking on new carriages as it does so. While 2010 and 2011 were the years of the land-grab as vendors fought to win the first contracts from network operators, 2012 and 2013 look like being years of consolidation when – if all goes to plan – operators enhance initial deployments with a range of new use cases, and policy proliferates through the network and beyond.

But will it all go to plan? And to extend our metaphor, what exactly is the destination of the policy express?

There are plenty of reasons to be optimistic. As we have reported here and elsewhere, operators say in Heavy Reading surveys that they intend to greatly increase the number of policy use cases, from typically three or four today to 20 or more within a few years. But the really good news is that this anticipated expansion is actually starting to happen among pioneering operators. Both vendors and their customers report that initial use cases such as fair use management, bill shock and tier management are now being augmented, mainly by use cases that extend service packages and use more policy triggers – for instance, by introducing packages based on application or URL, by adding turbo-boosts and other add-ons, and with services such as family plans that share an allowance among related members.

In sum, the destination of the policy express is a service creation environment that connects a whole range of ever-changing conditions, including customer location, application in use and real-time congestion, to create packages that best suit both supplier and customer.

But to get to that destination, operators need to convince users that more complex granular data service offerings are in their interests, and their suppliers need to up their game across a range of key areas. For operators, it is becoming essential to foster close liaison between network planners, product marketing and IT, since policy control is no longer a mere network function handling traffic management. Equally, suppliers must improve policy creation environments, simplify interoperability through the policy and DPI value chain, and enable a massive, cost-efficient scaling-up on metrics such as transactions per second.

Heavy Reading believes that these challenges, formidable though they are, will be met by both operators and their suppliers; the prize is too great for them to fail. We anticipate that policy use cases will multiply in most networks, driven by the increasingly pressing need to differentiate and enrich service offerings, and we project a market for policy servers, DPI gear and associated software of some $2.5 billion by 2016, up from an estimated $984 million at the end of 2012.

As we report in this month's edition of the Tracker, many vendors have invested heavily to improve their platforms in the areas that count. But like any market projection it could be derailed if operators lose their nerve or vendors ultimately fail to deliver. We'll continue to track the leading indicators, for good or ill, in future updates.

— Graham Finnie, Chief Analyst, Heavy Reading

For more information about Heavy Reading's Policy Control & DPI Market Tracker, please contact:

Dave Williams
Sales Director, Heavy Reading
858-829-8612
dave.williams@heavyreading.com