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Microsoft Preps for Telco Battle

Microsoft Corp. (Nasdaq: MSFT) made a big impression at this year's Supercomm.

Seeing an opportunity to break into the telecom market, where it has never been a significant player, Microsoft has latched on to some of the hottest trends in the industry -- IPTV, VOIP, and service delivery platforms (SDPs) -- and has won some high-profile accounts. (See Microsoft Targets Triple Play , Carriers Buy Into SDPs, BellSouth Trials Microsoft's IPTV, Microsoft Pushes Deeper Into Carriers, and SBC Awards Microsoft $400M IPTV Deal .)

Leading technologists at last week's show said they expect the company to become a major force in telecom networks.

"They are embedding VOIP and SIP-based capabilities into their next-generation software, and I think Microsoft is going to be a key player in the telecommunications industry in a broad way," said Bill Smith, CTO of BellSouth Corp. (NYSE: BLS), when asked about Microsoft in an LRTV interview.

Microsoft's telecom strategy is built around the development of the firm's SDP, the Connected Services Framework (CSF). The emergence and acceptance of that concept and the broader convergence architecture that is IMS (IP multimedia subsystem) is being driven by the build-out of broadband access infrastructure, says Michael O'Hara, general manager of Microsoft's communications sector service provider business unit (see Why SDP Matters Now, IMS: Pulling the Pieces Together, and IMS Guide).

"We're looking to shift from being a big IT partner to the telecom operators to being a strategic partner," says O'Hara, former head of marketing at softswitch vendor Sonus Networks Inc. (Nasdaq: SONS).

O'Hara says he's working alongside former Lucent Technologies Inc. (NYSE: LU) and Nortel Networks Ltd. (NYSE/Toronto: NT) employees.

The software giant, long dismissed as a provider of carrier-grade technology, is starting to deliver a credible telecom story, say observers attending last week's show. (See Portal Gets Jiggy With Microsoft for its previous attempt to break into the carrier back office.)

Microsoft has backed up its story with an impressive lineup of top-name partners in the form of AT&T Corp. (NYSE: T), Amdocs Ltd. (NYSE: DOX), and Accenture. So, that's the letter A taken care of… (See Accenture, MSFT Team on SDPs, Amdocs Teams With MS, and AT&T Adopts Microsoft's SDP.)

O'Hara won't talk about customer or revenue targets for the firm's communications sector, though he does say the unit's revenues include all Microsoft software sales to telecom service providers, including the license of standard Office software packages and Windows licenses.

Microsoft thinks it can help carriers create and manage the delivery of multiple services over IP -- that's SOIP, if you're inclined to use yet another acronym. (Incidentally, SOIP has been around for a while, as it also stands for Sales, Operations, and Inventory Planning; Sequential Overhaul Improvement Plan; Storage Over IP; and Sex Over IP.)

O'Hara's serious about SOIP, though. "You can take all our applications and host them on the network and offer them to small and medium-sized businesses. Then there's the IPTV systems [from the company's Microsoft TV division] for entertainment services, and our partnership with Sylantro Systems for VOIP." Sylantro, one of the two major hosted IP platform vendors along with BroadSoft Inc., is working with Microsoft to integrate its services software with the CSF (see Microsoft, Sylantro Team Up ).

So are there any types of carriers Microsoft sees as more likely to adopt a broad range of hosted service systems? O'Hara says the SDP concept will likely appeal more to the larger players to begin with, so he expects earlier traction with Tier 1 carriers. But he concedes that "you get a variation in the acceptance of the Microsoft platform. There are companies out there that are using Unix and Linux."

Of course, there's always the chance that Microsoft could trip over its own feet. While major operators seem keen to work with the software firm's SDP, industry concerns and problems related to the IPTV platform seem to be cropping up quite regularly (see Swisscom IPTV Stall Sends Shivers, SBC, Microsoft Defend Lightspeed, and IPTV: Microsoft's Window to Carriers).

— Ray Le Maistre, International News Editor, Light Reading
(R. Scott Raynovich, US Editor, contributed to this story).

OldPOTS 12/5/2012 | 3:11:16 AM
re: Microsoft Preps for Telco Battle SDP concept is not new, try AIN SCP & SCEs. SDPs need to support a lot of apps or the network will need a lot of BW.

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