Only very few single-source vendors can deliver a complete service delivery platform (SDP), based on either their own or partners' products, address the multifaceted requirements of SDPs and take on a prime implementation leadership role. Gartner evaluates 10 key vendors. We evaluate and benchmark leading vendors in the next-generation (NG) SDP market according to a set of defined parameters, including scope of product suites, solution scalability, professional services capabilities, transformation expertise, and partnership and customer track record.

This analysis is based on a survey that was sent out in the context of this NG SDP scorecard research, as well as on in-depth interviews with vendors and communications service providers (CSPs). This report offers guidance to CSPs with respect to strategic NG SDP vendor sourcing decisions. It will help NG SDP vendors to reassess their position in the market in relation to their key competitors. It allows for comparison of vendor competencies in the context of evolving NG SDP market requirements.

• Most NG SDP vendors have beefed up their solution offering and strategy, resulting in more mature, comprehensive solution offerings, in some cases as a result of acquisitions.
• Deploying an end-to-end NG SDP requires complementary IT, telecom network application and system integration skills, and consulting capabilities. Successfully offering integration with legacy networks, intelligent network (IN) systems, as well as adjacent business support system (BSS) prepaid and postpaid billing and operations support system (OSS) service fulfillment and assurance becomes a decisive capability. However, application integration capabilities (for example, app stores in some cases), digital commerce and over-the-top (OTT) platforms also become important differentiators.
• As NG SDP infrastructure becomes more mature, CSPs are tending toward gradual improvements of existing architectures. This involves consolidation of legacy NG SDPs in line with modularized "evolutionary" enhancements moving toward strategic platforms for future services to ensure sustained innovation.
• The skills of network equipment providers (NEPs) and system integrators (SIs), as enhancements to established telco service revenue, are becoming increasingly important to CSPs. However, CSPs' focus will gradually shift to IT-related issues such as Web 2.0, mashups and network enablers. In the medium term, it is vital to have skills on both fronts.

CSPs:

• Invest swiftly in a more agile creation and delivery environment for innovative services to be able to anticipate new value chains and sources of revenue. Waiting too long will mean a failure to attract new subscribers and maintain profitability in the next five years.
• Request commitment from strategic suppliers to transform silo-based service infrastructures into an open, standards-based NG SDP architecture that still allows reuse of legacy service components.
• Software-as-a-service (SaaS) business models might help to mitigate risks, control costs and yet join a complete ecosystem of back-end, client and developer communities.
• Center immediate efforts on pragmatic enhancements to existing telco services to leverage legacy assets in new composite services. In the medium to long term, however, IT matters such as Web 2.0, service exposure and device enablers, and application stores, as well as improvements to the user experience, will be imperative.

NG SDP Vendors:

• For long-term success, take a preintegrated approach to NG SDPs, OSSs, BSSs, subscriber data management and end-user devices, content management and network integration.
• Offer strong consulting, business and system process management, implementation and support services — if necessary in partnership with integrators. SIs should partner with NEPs to address network-related requirements.
• Improve solutions' integration with those of third parties, and with network enablers and Web 2.0 services. In the long term, plan for cloud-based SDP offerings.

The worldwide market for NG SDP products and services has matured in the past year. The majority of CSPs around the world have been involved in SDP deployments at various stages. NG SDP vendors have evolved their offerings to more comprehensive solution suites in an attempt to amalgamate IT and telecom assets to be able to live up to the increasingly complex challenges of the new telco world.

Overall, vendors' SDP architectures show greater alignment with CSPs' needs. In time, NG SDPs will become more and more a key business enabler, as focus shifts toward new business models that entail third-party participation, revenue generation and improvements in customer experience. However, CSPs' immediate focus is to migrate current revenue-generating services to new platforms that are more cost-effective and flexible. The main emphasis is still on how to get more out of existing services and on moving existing customers to a new service layer. Nevertheless, requirements to find new sources of revenue and offer an improved end-user experience are starting to grow in importance at the same time.

Moreover, CSPs are increasingly interested in working together, which is clear from initiatives such as the recently announced Wholesale Applications Community. In the future, SDP vendors need to support CSPs' requirement for increased collaboration by providing adequate products — for example, app stores spanning multiple CSP entities.

Hence, network and service exposure rank among the top priorities, as CSPs are especially interested in getting third-party developers to develop applications on top of their networks and systems. New sources of revenue require pursuing the upstream business model by monetizing third-party application and content providers, and making the third party's products and services available to the operator's downstream customers. The prerequisite, however, is an open, standards-based service exposure platform, along with an app store strategy obtaining content delivery and storefront platforms, as well as adjacent charging, advertising and partner settlement.

NEPs with a strong footprint in major CSPs around the world have an opportunity to shape the SDP market's development by capitalizing on their control of proprietary network technology and extensive knowledge of how to connect telecom applications to CSPs' network resources. Here, approaches driven by the IP Multimedia Subsystem (IMS), including the industry-backed IMS Rich Communication Suite (IMS-RCS), will play a key role. NEPs are moving up the value chain or even becoming SIs to fill in IT gaps through partnerships. This reflects the necessity for an SI coordinating role that pulls together all the pieces. On the other hand, we see major OSS and BSS vendors entering the market, providing real-time convergent application solutions and enablers, and the associated operational and business support. Last but not least, IT companies are taking a strong position in the market, essentially addressing all focal requirements, providing comprehensive end-to-end solutions that fit any kind of CSP.

Five types of provider compete in the SDP market:

• NEPs.
• SIs.
• IT houses and IT services companies.
• Software infrastructure providers.
• Independent software vendors (ISVs).

This report presents a scorecard that evaluates leading SDP vendors. It will help CSPs make informed sourcing decisions and enable vendors to compare their capabilities with those of competitors. We think the vendors included account for most of the NG SDPs deployed so far.

For this evaluation, we combined Gartner's general information on CSPs' overall transformation and NG SDP requirements with information from NG-SDP-specific workshops and enquiries from clients. We also benefited from meetings with, and a dedicated survey of, NG SDP vendors.

The inclusion criteria for this document are based on the top eight vendors according to "Market Share: Telecom Operations Management Systems (BSS, OSS and SDP), Worldwide, 2007-2009," as well as those players that have a strong position in the OSS and BSS market. Our definition of NG SDPs encompasses functions such as:

• Service creation environments.
• Service execution environments.
• Service orchestration.
• Common enablers, such as those relating to presence and location.
• Network and service exposure.
• OSS/BSS gateways.
• Third-party abstraction.

To be included, vendors also had to have a strong geographical footprint (presence in at least two world regions).

Enterprise-focused solutions were excluded.

Vendors were scored on seven criteria using a scale of 1 to 5, with 1 being the highest and 5 the lowest. Each criterion was given a low or high weighting.

• Product or service:
  • Core goods, services and skills offered by the vendor in relation to NG SDPs.
  • Weight: High.
• Market understanding:
  • The vendor's ability to understand buyers' wants and needs, and to translate that knowledge into products and services.
  • Weight: High.
• Offering (product) strategy:
  • The vendor's approach to product development and delivery, with an emphasis on differentiation, functionality, methodology, and features in relation to current and, in particular, future requirements.
  • Weight: High.
• Geographic strategy:
  • The vendor's strategy in directing resources, skills and offerings to meet the needs of customers around the world, either directly or through partners, channels and subsidiaries.
  • Weight: Low (so that regionally focused vendors were not penalized).
• Sales strategy:
  • Completeness of the vendor's go-to-market model as expanded by partnerships.
  • Weight: High.
• Market responsiveness and track record:
  • Deployments so far.
  • Weight: High.
• Overall viability (business unit, financial, strategy, organization):
  • Includes assessment of: the overall organization's financial health; the success — financial and otherwise — of the business unit concerned with NG SDPs; the likelihood that the business unit will continue to offer the product, invest in it, and advance the state of the art within its product portfolio.
  • Weight: Low.

The outlook for the emerging global market for NG SDP solutions is positive. Despite economic turmoil, the market has been characterized by relatively strong growth rates, with 11% growth in 2009 and a forecast compound annual growth rate (CAGR) of 11% through 2014. We see the most established vendors working on continuous improvements to their offerings to support telecom CSPs' evolving business models. Vendors have encroached on adjacent domains, such as app stores and advertising, to fill solution gaps and provide more comprehensive offerings. Generally, market concentration is increasing, as the leading players in the NG SDP market continue to gain more market share, achieved through organic growth as well as acquisitions.

Most vendors have adjusted their offerings to suit CSPs' preference for a gradual approach to implementing NG SDPs. This trend is being strengthened by the current macroeconomic turbulence, which is likely to extend into 2H10.

• NG SDPs are becoming more of a key business decision at C-level, rather than a merely technological decision, and require a proven ROI impact on the business. Hence, proficient vendors in this market need to engage with a different clientele within the CSP's organization and offer business process consulting, as well as provide strategic end-user comprehension.
• The most significant driver for NG SDPs is associated with new services and revenue generation, in conjunction with the monetization of existing network assets. NG SDPs are increasingly seen as an enabler for CSPs to participate in new value chains. Partners, third-party content providers, Internet providers and advertisers require CSPs to open up and expose their network assets, providing open network APIs for third-party developers and application stores. This is essential to provide more personalized, convergent Web and telco services to end users. This need has been manifested in the uptake of app store initiatives, such as the Wholesale Applications Community.
• Existing services still represent the largest revenue source and the main focus is on further leveraging legacy services and moving customers onto different service layers.
• Mergers between telecom- and IT-specific capabilities become crucial, expressed through the exposure of network enablers to third parties, and the vast range of applications and innovations available through the Internet become imperatives. The resulting mashups of telecom and Web-based sources have increased the number of services and potential business models.
• Vendors have enhanced NG SDP offerings to CSPs as hosted services (software as a service [SaaS]); for example, for convergent application servers and application storefronts. New offerings also encompass, for example, platforms (platform as a service [PaaS]) in "the cloud." Enterprise users in particular may benefit from these offerings, although they are very futuristic.
• Ultimately, CSPs' legacy evolution has been a major theme in the context of NG SDP investments. NG SDP solutions need to address how to architect existing SDPs so that the current services layer interacts seamlessly with the evolving underlying mobile and fixed IN networks.
• The goal of achieving greater operational agility and the smooth rollout of new services requires an end-to-end view of operational processes. Consequently, CSPs are gradually pursuing wider preintegration of NG SDP modules with adjacent OSS/BSS functions, especially convergent charging and user profile data management, service assurance and analytics, as well as digital commerce. This means that CSPs' behavior is shifting from sourcing discrete SDPs, to applying a wider service delivery environment/service delivery framework type of thinking that takes into account other operational domains as well.
• We see a lot of hype connected with the enablement of application stores, although these still represent a relatively small source of revenue at present. The overall NG SDP market structure is evolving. New players, such as Amdocs, have entered the market. Vendors such as Huawei and Oracle have gained notable market share. We also see a trend toward greater market consolidation reflected through a number of acquisitions, such as Oracle's acquisition of Sun Microsystems and Convergin.

The following sections briefly compare vendors in relation to the criteria outlined above.

Most NG SDPs will be deployed in modules, based on a long-term migration path, usually in alignment with predefined target architecture, leveraging existing legacy assets. This will certainly be the case in multivendor environments. Nevertheless, it remains a useful exercise to compare the products, services and skills of different NG SDP vendors, as CSPs usually pick one strategic vendor to provide comprehensive experience.

When all the different product capabilities required to build an NG SDP are considered — network, third-party and OSS/BSS abstraction; service creation, orchestration and execution; common enablers; content management; network and service exposure; and identity management — the majority of vendors emerge positively. In the past three years, the leading vendors included in this scorecard have caught up significantly in terms of breadth and depth of their portfolio. Most of the surveyed companies now have a broad, advanced SDP product portfolio, coupled with strong system integration, process and NG services consulting expertise. IBM's offering will basically fit any kind of vendor and represent the most comprehensive end-to-end offering, ranging across traditional telco, Internet Protocol (IP) and IT disciplines. Others, such as Amdocs and Telcordia, focus on a specific niche segment, offering partial solutions. However, specific technology strengths still differ as well — Ericsson and Huawei are strong in the wireless NG SDP segment, while Alcatel-Lucent is the main supplier in the fixed segment.

All the surveyed vendors have proven that they have a solid understanding of the market, which is reflected in the way they respond to its needs. They appreciate the real-world issues their customers are facing. All these companies understand CSPs' NG SDP requirements with respect to NG services, business and operational processes, and architectural issues.

The majority of the vendors surveyed in this report achieved a score of "strong" for product strategy; only two were rated "very strong." This means that a strong or very strong vision for the future of this market lies behind their product development and delivery plans.

Accenture and IBM stand out because of their strong professional services, system integration and process re-engineering capabilities, pulling together world-class partner ISV solutions into an NG SDP framework. We expect the SI approach and the standardized, out-of-the-box product approach to coexist in CSPs' current environment. These two vendors look to be the most convincing when it comes to providing a gradual, long-term migration plan for a full-blown NG SDP. Such migration plans help CSPs mitigate risk and improve operational efficiency, while gradually implementing new SDP components into existing network environments. Accenture and IBM can also capitalize on their consulting capabilities in other industries, which is valuable for the two-sided, Web 2.0 business model that is becoming a focus for CSPs.

Our evaluation of vendors' geographic strategy is based on how many resources they allocate to specific regions outside their home region to support customers' NG SDP requirements. Accenture, Oracle, Nokia Siemens Networks (NSN) and Alcatel-Lucent all have good geographic traction and commitments in all regions. IBM and Ericsson are outstanding in terms of geographic presence, having made enormous investments worldwide, especially in emerging markets. All these vendors have test labs, partner support and their own integration capabilities in all geographic regions.

Some vendors in this survey are rather locally focused and partially direct resources to areas outside their home region directly or through partnerships, channels and subsidiaries. Moreover, references of those vendors are predominantly centered on, or limited to, one geographic region.

This criterion concerns a vendor's go-to-market strategy. The majority of vendors have improved their sales strategy since 2009's scorecard and received a "strong" rating regarding their go-to-market and sales strategy. They have continued to build an appropriate network of direct and indirect sales channels that can increase the scope and depth of their reach. They all have well-segmented and targeted go-to-market strategies, and networks of partners that span the globe.

Vendors with a score of "stable" for sales strategy have an adequate network of partners or channels.

Ericsson, Accenture and Huawei have the most extensive NG SDP implementations. We therefore rate them "very strong" in this regard. Huawei and IBM also have large and complex implementations, while Oracle continues to succeed in selling modules into its existing accounts, as well as new accounts. These companies stand out for their ability to respond to market requirements and deliver on their vision. This is not surprising, as these companies have capitalized on consulting, system integration and network-related capabilities.

Such early success is a good indicator of a vendor's competitiveness and, therefore, of which companies are likely to lead in the long term. We think the market for NG SDPs will pick up further in the coming year, and that companies such as IBM and Oracle will continue to capitalize on their strong end-to-end product strategy.

For this criterion, we considered NG SDP vendors' revenue in this market and their commitment to NG SDP investments. We also assessed the likelihood that they would continue to develop their NG SDP capabilities. We considered all vendors portrayed in this scorecard as "strong" regarding viability (see Figure 1).

Accenture's offering comprises products from various partners — chiefly Oracle and Alcatel-Lucent — that Accenture integrates into an end-to end NG SDP.

Accenture has one of the largest SDP footprints and a very strong track record, even though it did not grow as much in 2009 as did its leading competitors. More than half its deployments are in Europe. Asia is still a comparatively weak region for Accenture in SDP solutions.

Functions typically included in Accenture's deployments are service orchestration, third-party gateways, BSS integration and network integration (through NEP partners). The focus is on using the SDP to reduce complexity and integrate devices in the digital home for CSPs' own services and the Web 2.0 ecosystem. But Accenture's NG SDP can also be used for vertical business applications.

Accenture is typically also involved in implementing the overall architecture and process for its customers. The company has added to its capabilities in the areas of unified user information, policy management, service management and service creation. It also has a new focus on improving the customer experience through better customer care and billing.

Accenture's NG SDP is part of its "new product development and innovation" strategic initiative. This focuses on "helping service providers grow through better customer experience and bringing innovative products to market faster and at lower cost and risk."

Overall, the company's emphasis is more on Web 2.0 activities than on traditional telco services. But, due to market demand, Accenture has added NG IN integration with Oracle and Huawei.

The main challenge for Accenture will be to maintain good relationships with the NEPs that will be responsible for network integration and for supplying the increasingly important IMS infrastructure.

Accenture merits an overall score of "very strong" (see Figure 2).

Alcatel-Lucent's Service Delivery Environment (SDE) is a blueprint for a complete NG SDP architecture that covers application domains such as IMS, fixed-mobile convergence, enterprise collaboration, IP television (IPTV), mobile TV, mobile content and traditional services. An integration framework combines service enablers, and an exposure framework enables blending with Internet-based services.

As the fixed-technology leader, Alcatel-Lucent is well positioned in IPTV and is also a credible network and IMS core SI. It is partnering with leading IT solution providers and ISVs for additional functions such as service-oriented architecture (SOA)/orchestration middleware and IT OSS/BSS software systems.

So far, most of the company's service delivery traction has been with fixed operators. But new applications are a key interest area for mobile operators in particular. Accordingly, a key focus area for the company is Web 2.0 integration, exposure of network capabilities to third parties and end-to-end service management and delivery.

Alcatel-Lucent has taken innovative marketing steps, such as the introduction of Bell Labs Innovation Days, the ng Connect Program, and Open API Service developer program. The company is using these capabilities internally to prove its viability.

Convergence is a strength for Alcatel-Lucent. It has focused on IMS Web widgets to bring the PC into the realm of telco 2.0.

Alcatel-Lucent's overall strategy focuses on Application Enablement for customers, by providing solutions and enabling software applications, deployable in either capital expenditure (capex) or hosted mode. The Application Enablement focus makes NG SDPs an even more strategic area for the company.

IT integration, for which Alcatel-Lucent partners closely with major IT vendors such as IBM and HP, is a challenge, as the firm wants to become an "enabler company" for telco 2.0 business. Despite claiming 20 mobile content contracts, Alcatel-Lucent's track record for mobile NG SDPs remains limited compared with those of the leading mobile SDP vendors.

Overall, Alcatel-Lucent merits a rating of "strong" (see Figure 3).

Amdocs is a new player in the SDP market. The company entered the market in 2009 through its acquisition of U.S.-based jNetX for $50 million in cash. The acquisition, together with previous acquisitions of Qpass (digital commerce) and ChangingWorlds (mobile content), was a strategic move for Amdocs to fill a vital gap in its solution portfolio to be able to offer an end-to-end solution spanning OSS, billing and CRM suites. Like other players, Amdocs was pulled into the SDP market by evolving customer needs that center on an approach in which end-user experience, service enablement and monetization are the main drivers. This encompasses exposure of both telecom and IP components in the network to offer convergent network, IT and Web-based services.

The core of Amdocs' NG SDP offering consists of network abstraction, a service execution environment (Java-based application server), and exposure of network capabilities across legacy and NG INs. Amdocs is currently working on the integration of its SDP platform with existing interactive digital commerce assets, such as content management, charging and payments, partner management and advertising. Amdocs' strong position in the convergent charging platform market is a competitive differentiator in the context of increasing charging complexity for rich communication services. However, integration with adjacent service fulfillment components is also on Amdocs' future road map, as the service orchestration, configuration and activation for SDPs become mission-critical to ensure operational agility.

We expect Amdocs to gain SDP market share by selling into existing OSS/BSS customers, especially large Tier 1 CSPs and multinational CSP groups. Also, the fact that Amdocs is already involved in numerous large telecom operations management systems (TOMS) transformation projects will help it to increase its footprint in the NG SDP market relatively quickly. On the other hand, the new Amdocs proposition might be particularly interesting for smaller CSPs. However, it requires attractive business and pricing models that lower implementation and maintenance cost for the solution to become attractive to this target group.

Amdocs does not intend to build an end-to-end SDP ecosystem. The company's approach is centered on building its own product capabilities, rather than relying on technology partnerships. Recent acquisitions show that the company continues to boost its offering in the NG SDP space.

Conversely, Amdocs' convergent application/NG-IN-driven approach might obstruct previously strong jNetX relationships with NEPs, as they usually have their own IN solutions.

Amdocs scores an overall rating of "strong" (see Figure 4).

Ericsson is one of the strongest vendors in the NG SDP market, based on its track record, strong system integration and consulting capabilities, and an end-to-end SDP offering that relies solely on the company's own product capabilities.

Ericsson has capitalized on its position as a mobile infrastructure leader to succeed in the market for NG SDPs. So far, CSPs' efforts have emphasized the monetization of existing network assets, integration with IN and the evolution of existing services, so it is not surprising that Ericsson is well positioned. Beyond its installed base of telco infrastructure, the company has been able to leverage its strong expertise in application connectivity and deep network resources, and the service layer.

In the past year, Ericsson has endeavored to augment and preintegrate OSS/BSS functions — especially service assurance and analytics — into its SDP offering. It has also made organizational alignments toward a "one-stop shop" software and service organization to support evolution to all-IP networks.

Ericsson's modularized, step-by-step deployment model for NG SDPs suits CSPs' horizontal IT evolution. In 2009, Ericsson was awarded end-to-end implementations with international CSPs across multiple subsidiaries.

Ericsson has invested more resources in NG SDPs than any other NEP, and its development efforts continue to focus on improving the integration of its NG SDP portfolio. Ericsson Composition Engine, Service Integration Gateway (SIG) for service exposure and Multiservice Proxy for data traffic optimization and monetization, along with Mobile Service Delivery Platform (MSDP), form Ericsson's core NG SDP offering. Ericsson's Drutt MSDP 3.0 supports new business models for on-portal and off-portal traffic.

The recent evolution of this core NG SDP offering encompasses, in particular, bundling Multiservice Proxy with MSDP, app store, advertising and digital commerce. Multiservice Proxy is a unique Ericsson asset, which is basically an evolution of a Wireless Application Protocol (WAP) gateway, and allows operators to monetize off-portal traffic with, for example, ad insertion, parental control and URL filtering.

MSDP now also serves as the back-end for Ericsson's multichannel (mobile, Web, IPTV) application store offerings. Moreover, the NEP recently announced the launch of its app store offering as SaaS, comprising digital commerce, advertising and charging.

The integration of Ericsson's multimedia products with acquired LHS assets is finally beginning to result in synergies and to have a noticeable impact on the market. However, other product lines would benefit from an organizational alignment with multimedia as well. For example, subscriber data management still resides in the network domain and not in the multimedia domain.

Ericsson is very strong in IMS and traditional telco services, but for new telco 2.0 services that require collaboration (for example, with Internet providers), the company will need partners beyond Ericsson Mobility World, the mobile-focused external developer ecosystem. However, on a positive note, Ericsson has engaged in new agreements with content aggregation providers. At present, Ericsson cooperates with leading IT platform vendors such as Oracle, IBM and JBoss. But given CSPs' increasing focus on vendor-independent solutions, Ericsson's NG SDP business would benefit from more extensive partnerships to shine even more on the IT side of the business.

Ericsson merits a rating of "very strong" overall (see Figure 5).

HP's current SDP is the 3.0 version of the platform. Version 2.0 was an end-to-end convergent SDP for abstraction and integration of all services, including network, IT and Web 2.0 services, including identity management, and served as a real-time, single-source broker of dispersed user data. Version 3.0 adds more focus on revenue generation through functions such as Service Governance. The new RESTful (conforming to the representational state transfer [REST] constraints) Gateway helps Web 2.0 developers create services more easily and automates access to Web tools. Enabler enhancements help developers create Web 2.0 services by providing new NG IN enablers, allowing developers to tap into data in video, subscriber databases such as the home location register (HLR)/home subscriber server (HSS), network address books, profile management, and real-time service control. The revenue management module enables service providers to monetize their network assets and partner relationships with a revenue-sharing model for partners and Web 2.0 developers. Service orchestration manager defines business or composite services workflow and provides off-the-shelf revenue-generating services such as Premium Short Message Service (SMS).

HP is well positioned as it understands system integration and even quite deep network equipment issues because of its network enablers, mainly in the HLR/HSS and media server fields. HP is also building expertise in the fields of content management and IPTV. Importantly, the company has a strong global end-to-end OSS with a large installed base. HP's OSS offering addresses convergence, triple-play and value-added services, and the service desk environment, with a particular focus on testing and certification of services. Overall, OSS integration will be one of the most important issues for HP to solve in future large-scale NG SDP implementations. HP OpenCall Media Platform adds value in this area as a service enablement platform for personalized content, such as messaging and video. HP is also focusing on the third-party gateway functionality of its NG SDP, which we consider crucial for the future success of the whole NG SDP concept.

HP benefits from an extensive partner relationship network with infrastructure, applications and third-party application development ecosystems. Moving forward, we expect the company to benefit from its strong IT infrastructure play, as parts of SDP evolve into a shared service and need optimization expertise in the connectivity, storage and process areas. However, HP will face fierce competition from some of the major players with sales strategies as equally services-led and that did not grow as much in 2009 as the market leaders did. HP is somewhat lacking momentum in the professional services business, especially in emerging markets.

HP merits a rating of "strong" overall (see Figure 6).

Huawei is a leader in NG SDP, with a growing market share and investment. It has been particularly successful in developing regions such as China, Africa and Latin America. Developed markets will be more challenging for Huawei because of the way CSPs are perceived.

Huawei offers an end-to-end NG SDP with network integration adaptors, APIs and templates for service innovation, a portal for convergent presentation, and a business processor with BSS/OSS. Along with the platform, Huawei offers applications for entertainment, digital media, communication, business and everyday-life applications. The company is increasingly trying to move to business consulting for service planning and professional support for service deployment and operation, rather than just selling and integrating products, as it has done until now. Huawei Software, the company division responsible for SDPs, has dedicated service people.

Huawei's NG SDP is mostly composed of Huawei's own products. Specifically, it includes: management framework for content and identity management and integration with existing BSS/OSS; service broker for real-time service orchestration; access gateway for network abstraction; service access gateway for API exposure to third parties based on Parlay X, Web Services and REST; and Service Creation Environment, Service Execution Environment and SOA Suite for service orchestration and business orchestration for partners such as IBM and Oracle. Huawei also has its own SOA service bus product. Huawei's offering includes Web and on-device portals and common enablers such as content optimization and ad insertion.

The challenge for Huawei is to grow its third-party relationships to combat the perception of vendor lock-in by CSPs. Despite the launch of Huawei's inTouch Partnership Program, other leading NG SDP vendors have already moved further ahead as far as application developer ecosystems and content owner relationships are concerned. Huawei also has a marketing challenge in building its brand in this space with established CSPs. Market share gains and new SDP deployments, as well as growing influence in the mobile third-generation (3G)/Long Term Evolution (LTE) domains, are helping the company here.

The company recently announced large contracts with emerging market subsidiaries of Tier 1 European operators. This is favorable for Huawei, as it seeks to enter the mature European markets but it needs to deliver stronger regional proof points.

Huawei merits a rating of "strong" overall (see Figure 7).

IBM is one of the current leaders in the NG SDP market, mainly because of its strong business-process-driven approach using the Service Provider Delivery Environment (SPDE) framework. IBM is the prime contractor for many complex SDP system integration and architectural transformation projects worldwide. It has an outstanding track record of continuous investment in NG SDP product development since 2001. In 2009, IBM launched SPDE 3.0.

IBM has the most complete product range and skill set in the NG SDP market, spanning IT, operations, products, and integration and consulting services. Its product portfolio covers service and application creation, delivery, management, execution, maintenance and integration, as well as network, OSS and third-party abstraction. At the heart of IBM's offering is WebSphere middleware. Recent enhancements encompass improvements to network abstraction and service exposure layers, preintegration of OSSs and BSSs, application storefront and networking enablers, and advanced analytics through the company's Netcool and Cognos assets. IBM's product portfolio breadth and depth can address the business imperatives of virtually any kind of CSP and hence it received a "very strong" rating for product or service.

IBM has stayed away from applications, but otherwise the only capabilities IBM lacks are core network equipment-related skills and the products with which an NG SDP needs to interface.

IBM's approach to NG SDPs is led by business and integration processes, with a focus on how technology is used in transformation efforts. IBM Global Services has a strong methodology and adequate resources to support complex, enterprisewide SDP implementations. Moreover, IBM has global SDP solution labs that support development and delivery, and a strong footing in emerging markets.

Rather than offer applications of its own, IBM focuses on providing an enabling environment in which ISV partners can deliver services to end users. As such, IBM depends on strong partnerships, especially in the content management and applications/services arena. As IBM is not an applications company, it makes a "safe" partner for ISVs.

We expect IBM to leverage its market leadership position in OSS service management, which encompasses the ability to monitor and react to the end-to-end customer experience of the delivered services. The alignment of service management with SDPs helps CSPs to further differentiate themselves from their competition.

As a traditional IT player, IBM does not have as much proficiency with CSP networks as the leading NEPs. However, IBM has been investing in labs and skills to improve its capabilities and has established strategic partnerships with leading NEPs. However, as NEPs increasingly want to compete in the SI market, there might be overlaps.

CSPs may perceive IBM's solutions as being expensive and its solution as monolithic. On the other hand, IBM faces great challenges to pull together all its strengths and assets, considering the extent to which IBM is spread across CSPs' organizational units. In emerging markets, where it has achieved strong growth momentum, IBM is trying to compensate for that with innovative pricing and a result-oriented approach to SDP projects.

IBM merits a rating of "very strong" overall (see Figure 8).

NSN takes a methodology- and blueprint-based end-to-end NG SDP approach, which is business led. The company's own SDP comprises network abstraction, service creation and execution, service broker, OSS/BSS gateways, complemented by prevalent OSS and BSS capabilities. It uses partners for content delivery, service orchestration and governance, nontelco service execution, service enterprise bus and some enablers.

NSN has skills in both fixed and mobile networks, including OSSs, and professional services. The end-user data products it acquired with Apertio are valuable additions to its service enablers.

Most of the NG SDP traction for NSN — as for the market in general — has been with mobile CSPs, especially in mobile content management deals in Western Europe, Central and Latin America, and Asia and in individual SDP component deals elsewhere.

NSN is particularly focused on evolution strategies for operators, comprising Signaling System 7 (SS7), IN services including prepaid support, content applications and content management, NG applications complementing/replacing IN systems, multimedia applications and advertising.

Although NSN hasn't reached the same market size as some of its competitors, it had some success stories (for example, Globe) and good service revenue in 2009. Nevertheless, NSN has succeeded in evolving its product strategy in a coherent fashion, pulling together a compelling mix of open IT middleware, as well as its own and partner IT and network-related assets.

The NSN blueprint comprises a range of convergent applications, ranging from legacy and NG INs to enterprise solutions, consumer multimedia and third-party content. However, it is missing an app store offering, which most of its competitors have. On the other hand, NSN has a strong convergent charging solution and OSS service assurance assets, which are highly relevant at the current stage of the market where end-to-end integration is increasing in importance. Hence we have given NSN a "strong" rating for its offering (product) strategy.

Despite a certain market momentum, NSN is in a delicate position in that it is the "child" of Nokia — a potential competitor in service provision through its Ovi services platform.

NSN merits a rating of "strong" overall (see Figure 9).

Oracle's SDP solution comprises the Oracle Communications Service Delivery product family, telecom industry-specific software products, and horizontal software products from the Oracle Fusion Middleware product family, such as Oracle SOA Suite, Oracle Business Process Management (BPM) Suite, Oracle WebCenter Suite (including Oracle WebLogic Portal), Oracle Identity Management and Oracle WebLogic Suite. On the end-user service side, Oracle offers enterprise applications, but is not a consumer applications company (except for a voice over IP [VoIP] offering). The company offers enablers for things such as location, presence, subscriber profiles, messaging and payments. Its portfolio includes: service creation, execution and management capabilities for IMS and legacy networks; service composition; orchestration; mobile marketing and advertising; service exposure; NG INs; online charging; and a policy enforcement suite. Its offerings are complemented by strong end-to-end telecom operations management capabilities encompassing OSSs, BSSs and CRM. Since our last iteration of the scorecard, Oracle has developed a mobile marketing and advertising campaign management product and has also acquired Convergin's integrated SS7-IP service broker for NG IN, online charging and service capability interaction management (SCIM) functionalities.

Oracle's acquisition of Sun, which was not done with a CSP focus, is also adding capabilities to Oracle on application store warehousing and storefront solutions with Oracle Java System Content Delivery Server, device-side data management and synchronization with Oracle GlassFish Mobility Platform, an open-source Session Initiation Protocol (SIP) application platform with Project SailFin, and CSP servers with Oracle Sun Netra Carrier-Grade Servers. The Sun acquisition also comprises the Sun Java Communications Suite, which has been renamed Oracle Communications Unified Communications Suite. It offers hosted telecom services with, for example, end-user applications for messaging, instant messaging, calendar and contact lists.

At the core of Oracle's NG SDP offering are the CSP-focused offerings acquired from BEA Systems, augmented with Oracle's non-CSP-focused SOA middleware products, which have helped to increase its telecom and SDP customer base and to widen its application partner ecosystem, with products such as Oracle WebCenter Suite for creating Web 2.0 services and Oracle SOA Suite for composite SOA services. Now Oracle has added to its SDP portfolio the already mentioned Sun assets (another non-CSP-focused major acquisition) and assets from the telecom-focused acquisition of Convergin.

Oracle faces a challenge to integrate and cross-sell its acquired products — both applications and platforms. Oracle focuses on the service layer, with connection and abstraction of the network layer. It has a strong service layer product portfolio and, with the addition of Sun, strong credentials in the area of "cloud" that offer longer-term promise for CSPs as a revenue source. The most notable omission is the user information part that CSPs need to connect and enable the service layer on top of the networks. The Convergin acquisition addresses part of this in taking Oracle deeper into NG INs and online charging.

As a software and hardware company, Oracle relies mainly on partners for overall system and network integration work in the telco space. Its partners include, for example, the SI arms of all the major NEPs with the exception of Alcatel-Lucent, as well as global system integration firms such as Accenture, HP and Wipro. However, Oracle has now started building its own consulting and services organization. Oracle must also strike a balance between partnership and competition, as its partners want to become enablers of telco 2.0, as telcos will increasingly move into this area.

Oracle also needs to tackle CSPs' perceptions of vendor lock-in.

Oracle merits a rating of "strong" overall (see Figure 10).

Telcordia does not offer an end-to-end NG SDP but uses its core skills in the contiguous OSS/BSS domains to complement the offerings of other technology providers. The Telcordia Converged Application Server sits at the heart of the company's NG SDP environment. Its interactive service delivery framework enables real-time service creation and execution, service control, policy control, charging, provisioning and activation. It is based on an integrated, modular and convergent architecture.

Telcordia's NG SDP portfolio centers on new interactive applications, such as mobile marketing and personalized advertising, as well as more traditional converged services, such as number translation, virtual private networks and call control.

Telcordia is gaining traction, especially in emerging markets in Asia/Pacific, Latin America, and the Middle East and Africa. Recently, it has reported wins in emerging markets such as India and Brazil for large-scale application server solutions for high-growth service providers. This is why we gave it a "strong" rating for market responsiveness and track record.

As well as capitalizing on direct customer relationships and direct sales, Telcordia works with integration partners such as IBM, TCS, Sicap and Wipro to deliver solutions to customers around the world. As a leading OSS vendor with a significant focus on developing NG SDPs, Telcordia is well positioned, although its SDP strategy tends to be mainly customer-centric, spanning its converged application server, real-time charging and large-scale in-memory subscriber data systems. Compared with other leading players, it lacks a strong focus on IT and Web services. Many deals are IN-led. Product and engineering relationships with other ISVs, SIs and NEPs would create a win-win situation for both parties in terms of ecosystem comprehensiveness.

Telcordia merits an overall rating of "strong" (see Figure 11).

The leading NG SDP vendors discussed in this document approach the NG SDP market from different angles, which makes it difficult to draw like-for-like comparisons. Accenture and Capgemini are SIs. HP and IBM are world-class SIs, but IBM is also an infrastructure and IT vendor, while HP is also an NEP. Ericsson is a world-class SI, but mainly an NEP. NSN is an NEP but also has significant SI skills, and the same can be said of Alcatel-Lucent.

NG SDPs present an ever-increasing complex system integration task, one that favors companies with SI and methodology skills. Application and content development capabilities, as well as application storefront capabilities, are major pain points for CSPs. The ability to expose network and service capabilities is a decisive competitive factor for CSPs in their fight for new revenue-generating services. This explains CSPs' value guidance to open, standards-based NG SDP architectures, which can be filled with genuine, out-of-the-box software.

When deciding on NG SDP suppliers, CSPs must carefully assess the capabilities of various vendors, considering the full scope of required evolutions, the underlying technologies, and the impact on OSSs and BSSs. Almost all players in this scorecard are pursuing the TM Forum's Service Delivery Framework approach, the philosophy of which is to take a wider perspective on SDPs, comprising, for example, OSSs, BSSs and device management functionality as an integral part of SDP offerings. For example, rating functionality for prepaid mobile services has improved, as it is a key part for mobile SDPs. Moreover, many vendors are enriching their offerings with OSS provisioning and activation, content and third-party settlement and charging, subscriber profile management and analytics capabilities.

In the immediate future, most CSPs will deploy modular NG SDPs. Their long-term goal is to have an integrated and automated SDE.

CSPs:

• In the immediate future, CSPs should focus on improving existing services, especially traditional telco voice services, such as enterprise voice offerings for small and midsize businesses.
• Rather than invest heavily in unproven applications, CSPs should improve the end-user experience they deliver, with the aim of increasing the use of voice and mobile services in particular.
• SaaS business models might help to mitigate risks, control costs and yet join a complete ecosystem of back-end, client and developer communities.

Vendors:

• In the short term, vendors' endeavors should address CSPs' current evolution and the expansion of "rich" voice applications.
• Vendors' immediate focus should also be on third-party abstraction, OSS abstraction, and device and terminal management and software.
• In the long term, vendors need to address CSPs' requirements in relation to Web 2.0 and network and service enablers. They also need to help CSPs make notable improvements to the end-user experience, reduce churn and boost revenue generation. Cloud-based SDP and SaaS offerings should also appear on the vendor's long-term product strategy road maps.
• The market for NG SDPs will become more concentrated and we expect to see more mergers and acquisitions in the coming years. However, niche vendors will struggle to survive if they fail to deliver nimble offerings that enhance existing blueprinted solutions as part of wider ecosystems.