Most carriers say they are increasing CAPEX in
growth areas tied to additional revenue, such as VoIP, broadband, IPTV, and mobile.
Nonetheless, carriers remain cost conscious and continue to need help improving
their margins, particularly in an environment where it is difficult to identify new revenue
streams. For further cost savings, Service Providers will focus on reducing operational
expenditures, in part by shifting investments from legacy TDM equipment to
products based on IP and Ethernet. Such new equipment enhances automation, consolidates
functions, collapses the number of networks, increases performance per dollar,
or introduces new functionality, all of which improve operational efficiency, reducing total
cost of ownership. Ideally, these investments also lay the foundation for additional,
margin-rich services. As operating expenditures are a bigger piece of a network??™s total
cost of ownership, reducing these expenses has a longer-lasting effect on cash flow and
improves pricing flexibility. A single converged IP/Ethernet-based network that supports
multiple services is the goal.
The Carrier Ethernet Equipment Market
Ethernet permeates metro networks more thoroughly as each year passes.
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