Market Insight

Diameter signaling revenue rose 5 percent in 2017, despite intense pricing pressure

February 06, 2018

Diane Myers Diane Myers Senior Research Director, VoIP, UC, and IMS

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Following is information and insight from IHS Markit about the Diameter signaling control market. 

Highlights

  • The global Diameter signaling controller (DSC) market grew 5 percent year over year in 2017, reaching $819.3 million.
  • While prices have fallen over the past few years, they took a big hit in 2017, dropping 29 percent year over year, which drove down revenue.
  • The market became even more concentrated in 2017, with most sales coming from a handful of vendors: Huawei, Ericsson, Nokia, Oracle, Mavenir, BroadForward, ZTE and newcomer Cisco.
  • The most important use cases in 2017 were centralized routing and roaming.

Our analysis

Diameter as a protocol continues to expand with the rise of 4G data and voice traffic worldwide. The increased traffic in the signaling and control plane of all-IP based networks requires operators to put signaling controllers in place, to more efficiently manage and scale the Diameter traffic.

Despite continued growth in licenses, DSC market revenue is expected to decline at a compound annual growth rate (CAGR) of 0.1 percent through 2022, due to ongoing downward pricing pressure. The biggest reason for falling prices in 2017 was increased competition, with larger telecom vendors discounting DSCs as part of larger packages. Incumbent DSC vendors have also been willing to go low to keep customers.

In terms of product enhancements, security through Diameter firewall capabilities is the leading area of development. Operators are driving demand for security capabilities, and vendors are delivering a variety of integrated and standalone Diameter firewalls. Additionally, the market continued to migrate to virtualized networks, and Diameter also moved in that direction.

With operators bundling DSCs with larger solutions, vendors with a broader portfolio of mobile broadband, IP multimedia subsystem (IMS) and policy products can rise above smaller vendors. Use cases continue to vary, as operators deploy multiple solutions, depending on the problem each is trying to solve. Some operators rely on one vendor for all solutions, while others choose solutions from multiple vendors.

Diameter Signaling Controller Report

The IHS Markit Diameter Signaling Control Annual Market Report tracks DSCs, which handle and secure the exponentially increasing Diameter signaling traffic on service provider networks triggered by mobile IP data and voice services. It includes worldwide and regional market size, forecasts through 2022, analysis, trends and a Diameter deployment tracker.

Research by Market
Mobile & Telecom
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