Mobile operators are rapidly adopting new network software, called EPC (Evolved Packet Cire), that will give them more control over service quality but also new tools for metering data usage.
Annual spending on EPC will grow by more than 10 times in the next six years, from US$200 million in 2011 to $3 billion in 2016, research company Dell'Oro Group said in a report this week.
Even in 2016, EPC will only make up half of all spending on packet core technology, with the other $3 billion going into the corresponding technology for 3G and 2G networks, Dell'Oro analyst Chris DePuy said. Overall packet-core spending will roughly double in the five-year period, from $2.9 billion in 2011. The growth is likely to benefit the current big players in mobile core networks, such as Ericsson, Huawei Technologies and Cisco Systems, according to Dell'Oro.
A key advantage of EPC for carriers is the ability to deploy VoLTE (voice over LTE), which is the only way for the new packet-based networks to handle voice calling.
EPC may also help mobile operators to compete with third-party service providers. It lets the carrier use what it knows about the quality of a subscriber's connection to make its own service run better over that link, through priority or other mechanisms.