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Italtel Gets the Softswitch Bronze

Light Reading
News Analysis
Light Reading
5/27/2005

Mamma Mia! Italian softswitch maker Italtel SpA is making inroads with carriers worldwide, according to VOIP equipment sales research from two U.S. research firms (see Italtel Boasts Softswitch Share).

The vendor had the third largest market share worldwide during the first quarter of 2005, behind the leader Nortel Networks Ltd. (NYSE/Toronto: NT), and Siemens AG (NYSE: SI; Frankfurt: SIE), according to recent reports from Infonetics Research Inc. and Dittberner Associates Inc.

Dittberner says Italtel supplied more than 14 percent of the more than 7.5 million VOIP ports shipped worldwide during the quarter. Italtel more than doubled its share of lines sold (from 6 percent to 14 percent) and passed two major competitors -- Huawei Technologies Co. Ltd. and Cirpack -- in the process.

Infonetics says Italtel’s marketshare “nearly doubled” in the Europe, Middle East, and Africa (EMEA) region, where, both research firms agree, it remains the leading softswitch vendor.

“Proof of Italtel’s leadership comes from both market data and the recently announced customer wins in France, Belgium, Great Britain, and Italy,” says Italtel VP of business unit products, Claudio Chiarenza, in a statement.

Italtel has an impressive customer list of European carriers but says it needs a partner to raise its visibility in North America. (See Italtel Boasts Softswitch Share, Italtel Claims Euro Leadership, Italtel Reports 2004 Results, FastWeb Picks Italtel , C&W Plans Its Own 21CN, and Belgacom Picks Italtel, Cisco.) The vendor believes North American carriers could benefit from Italtel’s experience with triple-play deployments in Europe (see Italtel: We Need US Partner).

Total VOIP equipment sales, the Infonetics report says, rose 40 percent to $493 million worldwide in the first quarter. Revenues from every VOIP equipment segment -- media servers, session border controllers, trunk media gateways, voice application servers, softswitches, and Class 5 packet switches -- increased from the first quarter of last year.

Sales in the fourth quarter were down 8 percent from the last quarter of 2004, when carriers invested prodigiously in VOIP infrastructure, according to Infonetics. Only the softswitch segment fared better during the first quarter: Revenues were up 4 percent from the fourth quarter of 2004, and up 63 percent from the year-ago quarter.

Dittberner's report says more than 14 million media gateway and softswitch VOIP ports were shipped during the quarter, a 6.33 percent increase over the fourth quarter of 2004.

North America spent the most on VOIP equipment during the first quarter with 45 percent of the total, followed by EMEA with 27 percent and Asia with 21 percent, according to Infonetics.

Infonetics analysts expect total VOIP equipment sales to grow to $5.8 billion in 2008.

— Mark Sullivan, Reporter, Light Reading

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