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Softswitch Economics
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Softswitch Economics
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Figure 11-3 The City of Denver s Legacy Nortel TDM PBX (Source: William Herwig, Cisco Systems)
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Figure 11-4 The City of Denver s new Cisco IP PBX solution. Note the size comparison with TDM PBX in Figure 11-3 (Source: William Herwig, Cisco Systems).
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via an IP network, the Class 4 would require VoIP media gateways requiring even more rack space. The smallest configuration for DMS-250 (Nortel s Class 4) is 480 DS0s (20 T1s). For many locations and service providers, this presents a potentially expensive overabundance of capacity. Many media gateways scale by the T1 or E1 card, enabling a greater flexibility in scaling down to capture certain markets and to take advantage of distributed architecture. If a service provider purchases and installs only what they need to get started in a given market and add capacity only as it is absolutely necessary, then capital is not invested in equipment that cannot immediately generate revenue. The capability of a softswitch to scale down is an advantage for many carriers. The smallest configuration for the DMS-250 Class 4 switch, for example, is 20 T1s. Many media gateways scale down to one T1 or less. A low-density media gateway could be installed in an outlying city, for example, and negate the need to backhaul long-distance traffic from that outlying city to a larger city where the Class 4 switch is collocated with a Class 5 switch in a central office. This eliminates expensive hairpins in traffic. Given the distributed architecture of the softswitch solution, the media gateway controller (MGC) and signaling gateway can be located elsewhere. This flexibility can also allow new operators to enter markets more easily. 6, Softswitch: More Scalable Than CLASS 4 or 5, covered scalability advantages of softswitch solutions.
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With fewer assets to power, softswitch uses less power. This translates into financial savings the service provider cannot ignore. A Class 4 configuration similar to that in Table 11-3 might draw 600 amps DC, as opposed to a comparable softswitch configuration that draws 24 amps DC. This translates into softswitch using only four percent of the power of Class 4.12 These sav-
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Interview with Nathan Stratton, CTO, Exario (www.exario.com), October 28, 2001.
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Softswitch Economics
Softswitch Economics
Table 11-3 Comparison of Class 4 and softswitch power draw and cost of power
Number of 7-foot racks for 36,000 DS0s Cost per month per rack for power at 20 amps at $20/amp Total per month Total per year per location Class 4 13
Softswitch 1
$400 $5,200 $62,400
$400 $400 $4,800
ings will be explored further in the net present value models at the end of this chapter.
Advantages of Distributed Architecture
Given a shift in the paradigm regarding distributed versus centralized architecture, it is possible that the domestic U.S. market might go the way of the long-distance bypass market. As described previously, long-distance bypass carriers were enabled by the introduction of smaller gateways to roll out service in diverse markets. They took market share from large, mainstream, long-distance providers. Let s assume service providers who were not traditionally voice service providers, that is, cable TV operators, Internet service providers (ISPs), power companies, or digital subscriber line (DSL) providers, wanted to originate and terminate long-distance traffic for their existing customers. Following the long-distance bypass model, they could install media gateways in a number of POPs in Tier 1 and 2 cities, and they could potentially take market share from the legacy long-distance Class 4 carriers. This scenario points to the displacement of Class 4 by softswitch, a disruptive technology. Figure 11-5 details how the components of softswitch interoperate. Each element can be located remotely from any of the others. As Figure 11-6 illustrates, distributed architecture enables a service provider to install only media gateways in each area serviced, as opposed to a Class 4 that requires an entire switch be installed in each area serviced. Given the difference in footprint and the accompanying cost, as discussed earlier, this can lead to substantial savings for the service provider.
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