March 2020-

In 2019, Diameter Signaling Controller (DSC) product revenues were essentially flat as a 11% increase in TPS license shipments was almost entirely offset by a 9% decline in average selling prices. During the year, service revenues increased by 5% spurring the total market to low single-digit growth.

For 2020, we are forecasting that the total market will contract by 5% as the impact of the coronavirus greatly impacts demand in 1H 2020. It is unclear how long the impact of the virus, and the fear of the virus, will last. The shock of the coronavirus notwithstanding, the demand drivers of the DSC market are strong. In particular the amount of anticipated growth in VoLTE subscriptions and traffic. Thus we forecast that the market will resume growth in 2021 and grow an average of 6% through 2024 (CAGR).  During this time, of course, operators will also be deploying 5G standalone (SA) networks which use a new signaling protocol, HTTP/2. Several network functions (BSF, SEPP, and SCP) will be responsible for handling the signaling traffic, similar to the DSC. We anticipate the market for these network functions to begin in 2H 2020 with revenues occurring in 2021.

For the full-year 2019, Huawei led the market based on total revenues (product + services). Huawei continued to benefit from strong growth in Asia Pacific in general and its home market in particular. Oracle remained the second largest vendor worldwide but continued to lead the market in North America. The market shift to Asia Pacific, and away from North America, was detrimental to Oracle in 2019 as they lost a point of share on a revenue basis. Ericsson and Nokia have continued to make progress in this market over the past several years. In 2019, Ericsson’s share was nearly even with 2018 while Nokia’s share approached exceeded 10% and was the only significant vendor to gain share for the year.

Of course, security concerns and geopolitical issues continue to hamper Huawei and ZTE in North America, parts of Asia, and increasingly in Western Europe.

Market and Vendor Reporting Metrics Include:

• Revenues (products and services)

• Transaction per session (TPS) license shipments

• Average Selling Price per TPS license

Regional Reporting:

• North America

• Europe, Middle East, and Africa (EMEA)

• Asia Pacific

• Latin America

(Certain country-specific information is available upon request)

For more information please contact: [email protected]