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TDM Replacement: Slow and (Hopefully) SteadyTDM Replacement: Slow and (Hopefully) Steady

The industry needs to sort out its strategy on the replacement of circuit-switched TDM local end offices. Quickly.

Jim Hodges

August 23, 2013

2 Min Read
TDM Replacement: Slow and (Hopefully) Steady

With all the potent discussion related to software-defined networking (SDN) and network functions virtualization (NFV), it's easy to lose perspective about what is happening in the legacy side of the telecom world. However, given we consider this is still a cornerstone of the telecom world, Heavy Reading continues to track the replacement of circuit-switched TDM local end offices on a global basis.

Our most recent update of the IP Network Transformation Tracker sadly confirmed the trend of the past two years: that TDM replacement continues to be a slow process.

As a proof point, using North America as an example, currently only about 31 percent of 152 million lines are VoIP or Packet Switched (PS). By 2017 this gradually improves to 42 percent based PS lines, but some of the growth is misleading given the total base declines by approximately 13 million lines. This level of decline is a common trend in many regions.

Figure 1: Source: Heavy Reading IP Network Transformation Tracker July 2013 Source: Heavy Reading IP Network Transformation Tracker July 2013

I understand why factors such as declining fixed and voice revenue and OTT application impacts make fixed-network investment a lower priority, but what concerns me most is the lack of a well defined transition strategy. Is there a global strategy to replace or simply invoke the sunset clause?

While there is some potential that NFV could play a role in providing a lower-cost approach to replace fixed switches, I have yet to see tangible commitment to making this happen. And if NFV is positioned this would likely lengthen the replacement process beyond 2017 given the incubation time NFV requires for commercialization.

Plus, set against this backdrop is the reality that by 2017 some TDM switches will be approaching 40 years old and still providing key services such as 1-800 and Centrex business services. While these switches are still performing on a steady and even keel, the concern that failure rates will increase is real with the potential for prolonged outages due to lack of spare parts, declining vendor support and the rapidly declining pool of in-house technical staff that understands in detail what happens on the peripheral and control side of a TDM switch.

To be clear, I don't believe we are yet approaching the panic stage predicted in E. M. Forster's seminal short story, The Machine Stops, but we need as an industry to develop a technology strategy of what happens to fixed services when the existing machines that support them reach "full stop" retirement age.

— Jim Hodges, Senior Analyst, Heavy Reading

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About the Author(s)

Jim Hodges

Chief Analyst - Cloud and Security, Heavy Reading

Jim leads Heavy Reading's research on the impact of NFV on the control plane and application layers at the core and edge. This includes the evolution path of SIP applications, unified communications (UC), IP Multimedia Subsystem (IMS), session border controllers (SBCs), Diameter signaling controllers (DSCs), policy controllers and WebRTC. Jim is also focused on the network and subscriber impact of Big Data and Analytics. He authors Heavy Reading's NFV and SDN Market Trackers. Other areas of research coverage include Subscriber Data Management (SDM) and fixed-line TDM replacement. Jim joined Heavy Reading from Nortel Networks, where he tracked the VoIP and application server market landscape and was a key contributor to the development of Wireless Intelligent Network (WIN) standards. Additional technical experience was gained with Bell Canada, where he performed IN and SS7 network planning, numbering administration, technical model forecast creation and definition of regulatory-based interconnection models. Jim is based in Ottawa, Canada.

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