September 08, 2009
On IP Communications for Mobile and Wireline Carriers: ITEXPO Interview with Taqua
By Erik Linask, Group Editorial Director
Last week, at ITEXPO West in Los Angeles, the conference sessions and exhibit hall again were clear evidence of the remarkable innovation that has overtaken the communications market – from enterprise and SMB products to solutions for service providers and carriers that deliver next generation communications solutions, both wireline and next generation wireless.
Perhaps most importantly today, successful vendors have a keen understanding of the need to enable smooth transitions between legacy infrastructures and next generation technologies, as well as the synergies between wireless and wireline providers.
I had the opportunity to spend some time in Los Angeles with Frederick Reynolds, Taqua’s Vice President of Marketing, to discuss some of these issues and to hear the latest on what the company is doing and seeing in the VoIP and wireless markets. Here’s what Frederick had to say.
EL: Earlier in the week, you announced that two additional North American LECs have chosen Taqua (News - Alert) to replace their legacy Siemens DCO switching systems. Given current macro economic conditions, how has Taqua’s core Class 5 switch replacement market been affected?
FR: The Class 5 switch replacement market really began in earnest in 2002 and picked up momentum in 2003. Frankly, that momentum has gone unaffected by any downturns we have seen in the last seven years. For virtually all incumbent service providers, legacy switches from Siemens, Alcatel-Lucent, Nortel (News - Alert), Redcom, and Mitel are fully depreciated and, more often than not, discontinued and incapable of delivering advanced services, such as IP and wireless. In fact, we have even replaced a number of competitors’ next genereation IP switches.
EL: One of the companies in your recent press release mentioned wireless switching capabilities as one of the reasons they chose Taqua. I’ve seen presentations regarding your wireless efforts, but can you give an update on your diversification that arena?
FR: Since announcing the Mobile Interface Card, we have been hard at work developing the solution with a couple of sets of partners – one set that can resell our products within their existing wireless solution, and another where we incorporate and resell their products within our wireless solutions. Today, we are participating in some significant market trials, and we are actively selling a fully converged wireless/wireline IP network solution that can provide a carrier with a combined mobile core and a Class 4/5 switch function in one consolidated solution.
EL: I understand that Taqua is part of a femtocell market trial with Cellcom that includes Starent Networks and Mavenir Systems (News - Alert). What role does Taqua play in that market trial?
FR: While both Starent and Mavenir are important partners with whom Taqua works closely, I am not at liberty to talk about any specific market trial. What I can tell you is that the Taqua 7000 is involved in at least one significant IMS/3GPP compliant Femtocell (News - Alert) market trial where the Taqua 7000 acts as the MGCF/MG within the wireless IMS core and provides PSTN connectivity and CDMA2000 codecs.
EL: When the Taqua 7000 is used as the IMS Gateway (News - Alert), is it also being used as the Class 5 softswitch for landline services?
FR: That is one of the benefits of using Taqua within this architecture. Because of the architecture of the Taqua 7000, service providers can implement the Taqua 7000 chassis with a mix of mobile interface cards to serve the role of the IMS wireless gateway and TDM cards for legacy subscribers. All the physical ports on the cards can be shared between the wireless and wireline networks. So, the carrier could have a common set of PSTN interface trunks, for example, which are shared by wireless subscribers and Class 5 subscribers.
EL: What does Taqua’s customer base look like today with regards to wireline and wireless, and TDM and IP?
FR: Taqua’s customer base is about two-thirds ILEC and one-third competitive carrier (CLECs and cablecos). About 75 percent of these incumbent carriers have wireless spectrum or are already delivering a 2nd generation wireless service. Our wireless efforts are a direct result of these customers’ requests. With Taqua MobileWorks, they can add a card to their existing T7000 and implement 2G/3G IP RAN and services to their business and effectively cap/ grow their wireless business at a fraction of the cost of other alternatives.
VoIP is now included by 80 percent of these companies, whether they are competitive carriers or incumbents. Even when we sell to small rural carriers, they usually require a mix of TDM and IP. While these companies still have a large installed based of TDM-only customers, there is almost always a large corporation, a school district, college, or government organization within their service area that wants more advanced IP services. The Taqua 7000 allows these service providers to easily address both sets of customers very cost effectively. Also, the vast majority choose to implement a NGDLC to terminate legacy POTS and, in most cases, these NGDLC’s interface with the T7000 through either MGCP or SIP, instead of GR303.
EL: In general is Taqua’s customer base almost exclusively small and rural?
FR: Not really. We have good mix of customers that includes two of the ten largest ILECs. We provide a very cost effective switch replacement solution for small carriers and many of our 200+ carriers would fit that category, but we also have customers that provide services to the vast majority of the NFL cities. Some customers may have one switch in one town, others may have a dozen switches serving tens of thousands of customers over a several large cities or states. It is a nice mix of large and small. It’s almost a 50/50 split in terms of sales from Tier 3/4 carriers versus what you would call Tier 2.
EL: How has Taqua as a company weathered this latest economic storm? There are a lot of larger equipment providers that have pulled out of this market, have failed, or are failing and have basically disappeared. It would appear that bigger doesn’t always mean more stable, more reliable, or better from a company-size perspective.
FR: Taqua is now more than ten years old as a business. We have been private again for over two years and have strategically sized our company to fit the market. I think you hit on something that bigger isn’t necessarily an advantage, whether you are an incumbent legacy provider or a next generation company. Almost all the larger incumbent equipment providers are gone from the market, and our field is littered with failed VC-backed companies that grew their next gen organizations too quickly for this market. That is a proven failed business model.
Taqua is on its third consecutive record quarter for orders. When you add the significant wireless opportunity that we are beginning to realize, I think it’s safe to say that Taqua has never been in as strong of a position both financially and strategically as we now have a wireline and wireless set of cost effective next generation solutions.
Erik Linask is Group Editorial Director of TMC, which brings news and compelling feature articles, podcasts, and videos to 2,000,000 visitors each month. To see more of his articles, please visit his columnist page.
Edited by Erik Linask