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Redback Networks Announces Top 5 Telecommunications Trends for 2009

^{Published on 2008-12-17 14:05:40 - Market Wire}
 

SAN JOSE, Calif.--([ BUSINESS WIRE ])--Redback Networks,an Ericsson company (NASDAQ:ERIC) providing highly scalable solutions that power the transformation of fixed and mobile carrier networks, today released its telecommunications predictions for 2009, outlining the industry's top 5 expected trends for the coming year.

A common trend is the critical need among telecommunication providers to lower cost structures and maximize technology investments — even more so given today's challenging economy. Architectural changes in the operations center will present new opportunities to carriers. These changes will allow carriers to re-think legacy strategies and deliver new and innovative service offerings for consumer IP multimedia and next-generation IT initiatives, such as virtualization and cloud computing.

Redback's Top 5 Telecommunications Predictions for 2009 include:

1. More Functionality at the Edge Leads to Cost Savings from Equipment Consolidation: Less will definitely be more in 2009, as operators look for ways to minimize hardware investments while maintaining highly scalable and flexible networks. For example, rather than purchasing and managing separate devices for edge routing, Ethernet aggregation and subscriber management, carriers are opting for multi-service devices that integrate various functionality into a single routing platform. We expect this trend will continue gaining momentum into next year.

2. A New Utilitarian View of IP Convergence: As the lines between service networks continue to blur, we expect greater convergence and a more "utilitarian" view of the network based on IP. Over the years a mix of business and residential service networks, as well as fixed and mobile, have been introduced into the operations center, adding greater complexity. This layering of services has made it difficult and expensive for operators to manage each individual network – signaling a much-needed move towards convergence. Since Ericsson's acquisition of Redback nearly two years ago, the two companies have been involved in over 145 deals together, signaling strong global interest for integrated fixed and mobile network solutions that will continue into 2009.

3. Seismic Architectural Transformations: 2009 is the year of architectural transformation. For the first time in decades, operators will have an opportunity to revamp legacy strategies and leverage recent routing innovations based on the increased importance of the edge and the move to converged IP. Operators will take stock of their networks and begin implementing more scalable metro solutions and lower-cost core networking solutions in response to global economic pressures. As telecommunication providers continue their IP infrastructure transformations, we will see the role of legacy equipment such as core routers focus more closely on switching and optics while intelligent routing functions move closer to the edge. During this shift, we expect to see a greater proportion of multi-service devices at the edge tasked with routing, as well as managing intelligent service functions like subscriber management.

4. Enterprise IT Pushes Service Innovation: It's a buyer's market, and the pressure will be on carriers to step up service offerings in support of enterprise initiatives such as cloud computing and virtualization. As a result, we expect greater subscriber management intelligence to be built into the network, causing a fundamental change in the economic relationships between carrier and enterprise. The enterprise will increasingly look to carriers to provide them with innovative, cost-saving virtualized IT services, placing carriers in an ascendant role driving the development of next-generation networks.

5. Mobile Broadband Proliferation: According to the Cellular Telephone Industry Association (CTIA), mobile data usage in the US grew 42.5% in the 12 months ending June 2008. Likewise, by 2011 the number of mobile broadband users will exceed fixed broadband users. In response, carriers have started working more closely with telecommunications providers to optimize their mobile broadband infrastructures. Over the next 12 months, carriers will move pilot programs to execution mode in a new era of mobile broadband. Operators will favor equipment providers who can deliver end-to-end mobile and fixed solutions.

"Telecommunications will undergo a sea change as operators aggressively reduce complexity, and search for innovative ways to streamline costs," said Georges Antoun, chief executive officer of Redback Networks. "Customers who have already taken steps towards integrating functionality at the edge using Redback's SmartEdge and SM platforms will find themselves ahead of the market and in a good competitive position. They are well-positioned to build sustainable next-generation networks that save nearly 60 percent in capital costs, 40 percent in operations costs and utilize half the energy."

About Redback Networks

An Ericsson company since January 2007 (NASDAQ:ERIC), Redback Networks has sold 107+ million broadband subscriber licenses to 75 percent of the top 20 telephone carriers worldwide. Redback delivers next generation broadband services such as VoIP, IPTV, on-demand video, and online gaming. Redback Networks has more than 500 carrier customers worldwide and is based in San Jose, CA. For more information, visit Redback Networks at [ www.redback.com ].

About Ericsson

Ericsson is the world's leading provider of technology and services to telecom operators. The market leader in 2G and 3G mobile technologies, Ericsson supplies communications services and manages networks that serve more than 195 million subscribers. The company's portfolio comprises mobile and fixed network infrastructure, and broadband and multimedia solutions for operators, enterprises and developers. The Sony Ericsson joint venture provides consumers with feature-rich personal mobile devices.

Ericsson is advancing its vision of "communication for all" through innovation, technology and sustainable business solutions. Working in 175 countries, more than 70,000 employees generated revenue of USD 27.9 billion (SEK 188 billion) in 2007. Founded in 1876 and headquartered in Stockholm, Sweden, Ericsson is listed on OMX Nordic Exchange Stockholm and NASDAQ.

For more information, visit [ www.ericsson.com ] or [ www.ericsson.mobi ].