A report from Innovation Observatory has claimed that the gross value of all international wholesale telecoms services transported by new IP eXchange networks (IPX) will rise from around $0.5 billion (1.4% of the international wholesale business) today to $D5 billion in 2017
As much as 25% of the wholesale value of traffic flowing over IPX networks will be generated from new and value-added services; LTE interoperability, roaming and voice services will also be strong drivers of growth, the report authors said.
Simon Sherrington, lead author of “Global IP Exchange: Current Status and Future Prospects for IPX” pointed out that there are strong reasons why IPX networks will become significant over the next five years: “Migration to all-IP networks and LTE, and the need for interoperability at multiple levels to support innovative new services at optimal costs will drive adoption of IPX,” he says.
However, Sherrington cautioned that significant barriers remain to be overcome if IPX providers are to achieve succeed in the IPX market. “We have identified nine barriers to IPX adoption during our research – among them a lack of critical mass, and of pricing clarity,” he said, adding that “there is a significant risk to established international carriers from hub-based providers with less to lose from pricing innovation.”
Report co-author Terence Prospero said, “The immediate task for IPX providers is ensuring that they can deliver voice, and LTE roaming services, in a manner that is seamless and transparent both to operators and to their end-users,” he adds.
The report found that wholesale buyers are generally indicating their willingness to buy when the time is right. It concludes that beyond voice and LTE roaming, there is tremendous potential to generate revenues from new types of services, and to deliver multi-billion dollar revenue streams if IPX providers make it easy for fixed and mobile service providers, device vendors, content and application providers to do business with them.
Earlier this year, HotTelecoms forecast that total International IPX revenue would grow by a CAGR of 55.6% and that by the end of 2015, International IPX data service would account for 72.3% of the total revenue, with voice expected to account for 27.7% of the total.