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IP Multimedia Subsystems’ $300 Billion Opportunity

  • Posted: Friday, March 14, 2008
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  • Author: pradhana

IP Multimedia Subsystem (IMS) is expected to provide mobile telephone operators with a forecasted $300 billion in extra revenue over the next five years, according to a new study from ABI Research. Major operators such as Sprint, Verizon and British Telecom (BT) will increasingly deploy IMS across their networks in a quickening tempo starting this year.

“Until recently IMS was mainly the province of fixed-line operators,” says senior analyst Nadine Manjaro, “but now it is essential to the success of mobile and fixed operators who are losing revenue from traditional sources. IMS enables rapid development and deployment of new services.”

Some firms – notably Verizon and BT – are facilitating this process by offering an open IMS interface allowing third-party developers easy access, as a way of ensuring a flow of new applications. This means faster testing and deployment of services, which will be critical to their success.

“Operators are forced to look at IMS and similar solutions because they need to start generating more revenue,” notes Manjaro. “With recent moves by Sprint, Verizon and AT&T to offer less profitable flat rate services as a way to fight subscriber churn, that need becomes more acute.”

One impediment to IMS’s success in the past has been the difficulty of proving the business case for it. But Manjaro suggests that planners were incorrectly considering IMS as a service rather than a platform. In fact IMS supports multiple services, and it takes several of them to make a valid business case. To use the hackneyed phrase, there has been a paradigm shift in operators’ strategic thinking.

The major remaining challenge for operators is to integrate IMS without seriously disrupting existing services. That need is being met by the major infrastructure vendors such as Ericsson, Alcatel, and Nokia-Siemens, which have been packaging IMS (at additional cost) with the network upgrades they provide to operators.


Manjaro points out that, “It’s easier to quantify the opportunity for operators because you can look at it in terms of potential revenue. It’s more difficult with regard to vendors, because they’ve been bundling it with the air interface, the base station, the architecture upgrade.” [ABI Research]

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