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Reliance Relies on Veraz

Light Reading
News Analysis
Light Reading
6/29/2005

VOIP infrastructure vendor Veraz Networks Inc. says it has displaced the media gateways of a large incumbent vendor with its win at India's Reliance Infocomm Ltd. (see Veraz Wins at Reliance Infocomm).

The vendor won't name names but says it is increasingly picking up wins where other vendors fell down. “We are hearing about operator after operator struggling to get their next-generation networks stable and operating to their satisfaction,” Veraz marketing director Ed Camarena says. “We’re winning customers that have tried other vendors and it just didn’t work out.”

Reliance has deployed 10 Veraz I-Gate 4000 PRO media gateways -- five in India and the rest in England, Hong Kong, and the U.S. (see VOIP Port Shipments up 6.3% in Q1). “They were using someone else’s media gateways, but we were able to give them much better compression and stability, and they ended up standardizing on our equipment,” Camarena says (see Veraz Enhances Long Distance).

“We hear horror stories from some of our customers where they have struggled for a year to make another vendor’s systems work and finally they give it up,” reiterates Veraz's VP of global marketing, Amit Chawla.

Veraz is a small company with only modest visibility on the global VOIP infrastructure landscape. Its Reliance win was for 60,000 ports in a market where more than 14 million media gateway and softswitch ports were shipped in the first quarter, according to Dittberner Associates Inc. Veraz has not yet cracked the Top 5 VOIP players in the world.

But Veraz has something going for it. Heavy Reading analyst at large Graham Beniston believes its compression chops come from the company’s lineage in the TDM world. “Veraz is owned by ECI Telecom, which brings a great history of hardware media gateways with specialized DSP capability,” he says (see ECI Lines Up Acquisitions).

Veraz was formed by the merger of NexVerse Networks and ECI's own VOIP subsidiary and focuses on “reliability, survivability, manageability, and call-routing flexibility as differentiators,” Beniston writes in the Heavy Reading report, "VOIP: A Competitive Analysis of Media Gateways."

Veraz has made sales in Class 4 TDM to VOIP transition and greenfield markets, and is now intent on following carrier spending to the edge of the voice network, Beniston says (see Veraz Maps to IMS and Primus Migrates With Veraz).

The Veraz media gateways are being used by Reliance to convert and compress international long-distance traffic into VOIP packets for most of the way to termination points around the world. A call from Bangalore, India, might move over TDM to a Veraz media gateway elsewhere in India, be converted and compressed onto Reliance’s international fiber optic network, and travel in packets to another gateway in Los Angeles, where the call is converted back to TDM for the rest of the way out to a termination point in Omaha, for example.

“This reduces the bandwidth need to about one tenth of what it would have been under TDM,” Veraz’s Camarena says.

The win at Reliance gives Veraz two things to work toward: softswitching wins on the back of its media gateway business there and larger carrier wins elsewhere in the world. Veraz has deployed in 30 countries so far and says most of its revenue is coming from emerging markets in Eastern Europe, Asia, India, and Latin America.

The company considers its biggest competitive threats to be Nortel Networks Ltd. (NYSE/Toronto: NT) and Sonus Networks Inc. (Nasdaq: SONS) in the U.S., and Siemens AG (NYSE: SI; Frankfurt: SIE), Alcatel (NYSE: ALA; Paris: CGEP:PA), and Ericsson AB (Nasdaq: ERICY) in Europe and Asia (see Siemens Unveils VOIP Package). Huawei Technologies Co. Ltd. is a growing presence in Asia and elsewhere.

The Dittberner first-quarter report says Nortel shipped close to 3.3 million VOIP ports worldwide, or almost 23 percent of the total. Huawei and Siemens each took about 13 percent of the market, the report says.

“When you look at a U.S. company, a small company, fighting the giants and being successful, I think it’s proof positive for the product, and its proof positive that the bigger guys need to watch out for Veraz,” Chawla boasts.

— Mark Sullivan, Reporter, Light Reading

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trzwuip
trzwuip
12/5/2012 | 3:08:53 AM
re: Reliance Relies on Veraz
Knowing the customer, Veraz probably sold at > 90% discount.
materialgirl
materialgirl
12/5/2012 | 3:08:42 AM
re: Reliance Relies on Veraz
So who did they replace? SONS networks are clearly hard to manage, but I do not think they have to global reach to have done the Reliance deal. That must have been NT or perhaps LU? If interoperability is the bugaboo, as SONS implies, how does this little outfit solve anything?

Don't these guys know if you get the gear for free, you could still lose on the deal through op-ex?
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