The Emerging SDP Market

Philip Marshall, PhD, Vice President, Yankee Group
January 2006

Service delivery platform (SDP) technology is emerging as a means for enabling service creation, deployment and execution functionality to be reused across multiple services and applications. SDP solutions are being offered by a variety of telecom network equipment and IT vendors, including Accenture, BEA, Ericsson, HP, IBM, Microsoft and Telenity. To date SDP specifications have not been standardized across the industry, however many of the major players have similar architectural frameworks. The SDP market will experience significant growth over the next five years, albeit off a small base, increasing from USD1.5 to USD8.8 Billion between 2006 and 2010, as is shown in Exhibit 1.

Since SDP solutions span a broad array of functionality incorporating a variety of platforms, the Yankee Group believes that it is more appropriately positioned as a service delivery environment as opposed to a platform, however for the sake of consistency we refer to this environment as an SDP. Exhibit 2 illustrates the positioning of the SDP in logical service delivery architectures. For near real-time applications such as Voice-over-IP, video and interactive gaming, the SDP integrates with an internet multimedia subsystem (IMS), which provides the control plane functionality for service delivery. For non-real-time applications such as messaging, the SDP can integrate with a variety of network environments, via a logical network abstraction which we refer to as the service enabling system. This abstraction consists of functionality such as service quality management, service and subscriber segmentation, security, provisioning, and charging. We believe that non-real-time services such as advanced messaging and mobile content downloads will prove most lucrative for service providers in the short to medium term, and therefore the most suitable initial market target for SDP solutions.

Services and applications integrate with the SDP via a variety of Web-Service and Web-Service-like interfaces, represented by the middleware layer shown in Exhibit 2. Since integration with legacy and telecom specific services and applications is needed, a variety of specialized, and in many cases proprietary, interfaces are also used.

A critical aspect of an SDP is its integration with business and operational support systems (BOSS). Today many of the solutions that are being proposed to the market are lacking in this regard, which create challenges for service providers who require functionality to efficiently manage and monetize their service offerings. In recent interviews with service providers in Asia Pacific, it is evident that service providers are looking for business support systems that enable efficient management of third party relationships. A service provider in North America expressed concerns regarding the cataloging of services and applications. Several European service providers were concerned about device management issues and believe that it should be treated more holistically with the OSS framework.

The SDP market is of strategic importance since it represents the glue between services and the telecom networks. Since the SDP market is both nascent and being integrated into a complex telecom environment, it is critical that vendors develop solutions that anticipate the legacy integration requirements. In addition, the industry will benefit from blueprints and implementation success stories that demonstrate how SDPs enable revenue generating opportunities.