Policy Matters to Mobile Broadband Operators
That was the key takeaway from Tuesday's Light Reading virtual tradeshow, Policy Control & Deep Packet Inspection, during which Heavy Reading analysts provided an update on the traffic management sector, and a number of vendors unveiled their latest market insights and product developments.
Several hundred attendees visited the online virtual tradeshow to hear Heavy Reading analysts and representatives from Allot Ltd. (Nasdaq: ALLT), BroadHop Inc. , Camiant Inc. , ComAbility Ltd. , Continuous Computing Corp. , LSI Corp. (NYSE: LSI), Openet Telecom Ltd. , and Procera Networks provide updates and views on a market that's under scrutiny in the U.S. in particular as the net neutrality debate rages. (See Net Neutrality: Not Neutered.)
Naturally, net neutrality featured prominently during Tuesday's event, with Cam Cullen, Allot's director of product management, Americas, dedicating time to the matter during his keynote address. Cullen laid out the reasons why DPI is still relevant to service provider strategies and operations even while the outcome of the net neutrality debate remains unclear.
That there is "more to policy than policing" is something that's been stressed in the past by Heavy Reading chief analyst Graham Finnie, one of the virtual event's hosts. (See Policy Rules?)
Cullen also noted, as did Finnie during his opening address, that the ongoing dramatic growth in the use of mobile broadband services, and the need for service providers to adapt their network traffic and business models accordingly, is driving the deployment of policy management and DPI capabilities. Heavy Reading estimates that the volume of data traffic running over 3G networks is growing at 400 percent annually. (See Verizon Rides a Mobile Data Wave.)
The Allot man cited a recent study that showed how HTTP streaming (video), HTTP download, and HTTP browsing are the main applications filling up mobile data access networks, well ahead of peer-to-peer (P2P) traffic, a clear sign that mobile broadband dongles and smartphones such as the iPhone that enable easy access to Web services are having a dramatic impact on service usage patterns. (See Allot Issues Traffic Report.)
However, Cullen also noted that P2P traffic tends to dominate in the mobile cell sites that are coming under the greatest data capacity strain.
Mobile driving DPI market growth
The rising data traffic pressure on mobile network operators explains why Heavy Reading's Finnie noted that DPI and policy control vendors say they're struggling to deal with the volume of RFPs (request for proposals) they're receiving from wireless carriers.
That mobile operators are driving market demand was confirmed earlier this week when Continuous Computing noted its recent success with a number of Tier 1 carriers. (See DPI Goes Mobile and Continuous Snags 12 DPI wins.)
That trend had been anticipated last year, when a Light Reading Insider report predicted that "annual spending by the mobile operators is expected to represent the majority of expenditure on DPI technology and applications by 2013." (See Deep Packet Inspection: Coming Soon to a Network Near You.)
And those mobile operators are fueling dramatic growth, even as carrier capex budgets remain constrained. Finnie noted during his opening address that the value of the DPI market (in terms of sales to service providers) is set to rise by 25 percent this year to be worth more than $500 million, and that it's set to grow to more than $1 billion by 2014.
Not surprisingly, the value of the policy server market is also increasing. Camiant, identified alongside Bridgewater Systems Corp. (Toronto: BWC) as a market leader by Heavy Reading, notes that, according to Infonetics Research Inc. , the policy server market was worth nearly $170 million in 2008, and is expected to grow by around 67 percent this year. Infonetics also identifies Camiant as a policy server market leader. (See Camiant Leads Policy Control and Camiant Touts Policy Server Growth.)
Camiant has also recently commissioned a study of consumer attitudes to mobile broadband tariff plans, concluding that "by redesigning mobile broadband data rate plans, operators will be able to help solve one of the industryâ€™s most pressing concerns," the "growing disconnect between bandwidth demand and revenue growth," or "bandwidth-value gap." (See Camiant Studies Mobile Data Rates.)
For more background on the policy management sector, check out the video interview with Heavy Reading's Finnie below.
— Ray Le Maistre, International News Editor, Light Reading