NGNs and the challenges facing Australian telcos

Next generation networks are the way of the future, but analysts and vendors agree that they carry a host of problems.

The general idea behind next-generation networks (NGNs), according to Wikipedia, is that one network transports all information and services (voice, data and all sorts of media such as video) by encapsulating these into packets, like it is on the internet. It goes on to say that NGNs are commonly built around the internet protocol (IP), and therefore the term 'all-IP' is sometimes used to describe the transformation towards NGN.

Colin Goodwin, strategic marketing manager - networks, at Ericsson Australia, says that the term NGN means the introduction of IP technology into the core and aggregation network of telephony networks.

"This uses carrier grade VoIP (voice over IP technology), in particular SIP and IMS standards," he says, adding that the expression 'soft switch' can also be used.

The other expression used, says Goodwin, is 'next-generation broadband network', which typically involves a very high capacity broadband access with speeds of tens of Mbps, which is in contrast to the current speeds of a few Mbps.

"Usually, these are delivered via FTTx," says Goodwin. "The status of next-generation networks in Australia is that most of the major carriers have introduced softswitch in various forms, and all of the larger ISPs provide some kind of VoIP carriage, typically with SIP. As for next-generation broadband networks, it has become a major debating point in the industry and an element of the coming election."

In a recent article by Paul Budde, of Budde Comm, he claims that NGNs are the biggest challenge facing the telecommunications sector in Australia.

"NGNs lay down the roadmap for Australia's digital media future, which will run a host of services, from social communications, information and entertainment to e-trading, e-health and tele-education.

"NGN isn't a single technology but more a business concept underpinned by IP-based infrastructure, in place of traditional telephone systems, to deliver high-quality multimedia," says Budde.

Goodwin agrees saying that NGNs fundamentally support a transition from what has been telephony networks to what are actually multimedia networks.

"The introduction of standards such as IMS and SIP means that it becomes profitable for telephony-like services and multimedia connections, video calling and so on. These are all supported through what are the next-generation telephone devices and handsets through PDAs, PCs, televisions and so on," he says.

"For a telco, it is a transition from a world of telephone calling to a world of multimedia calling. What that means for customers is a much richer set of options for communication."

The role for carriers in the advancement of NGNs will see a new line of business openings which will at least offer the advantages of consuming less energy, taking up less space and handling far more subscribers.

"If you examine IP switching equipment, such as softswitch and multimedia switches, and contrast it to circuit switching, they are extremely small and compact, very energy efficient and yet very powerful," he says.

"There will be enormous pressure on the telecom industry to build a new fibre network but this relates to the next-generation broadband network. Very high capacity access networks in the order of tens to hundreds of Mbps will also mean a need to have very high capacity metro or aggregation networks, and increased capacity for long-distance and international carriage. All of that connectivity is provided by fibre.

"The Australian telco industry is part of the worldwide movement towards very high access speeds, and therefore has a much greater capacity for aggregation networks and long-distance connectivity," he says.

Budde says that the rollout of fibre-to-the-home (FttH) is likely to follow where demand is highest for next-generation services.

"Fibre is being rolled out in most new housing developments but it is likely to take at least a decade for most Australians to be connected to FttH.

"What are needed for the internet economy are open networks. Operators should concentrate on making NGNs easy for content and service providers to link their networks to the public network (Layer 2 network access)," he says.

"NGNs should be based on wholesale structures, rather than retail structures. Open networks increase demand, stimulate infrastructure rollout and generate new revenues for telcos such as data centres, content hosting, outsourcing and billing. Overseas telcos such as BT and KPN are showing the way with an open approach."

But as Budde questions, will companies like Telstra be willing to follow a similar open path or develop complex NGNs to strengthen their dominance as a vertical integrated operator?

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