All about past, present and future of SBC.

1. By Mithilesh Kumar

2.  With Avaya's acquisition of Sipera--so soon following the
establishment of an OEM and reseller relationship between Avaya
and Acme Packet, and Siemens Enterprise's introduction of
OpenScape SBC-- the UC industry has shone a spotlight on session
border controllers. Once of interest mainly to telcos looking to
better secure and manage SIP trunks, SBCs started appealing to
enterprises seeking precisely the same thing.
 SBCs continue to make their way into the enterprises mainly
through service providers, which deploy them internally to secure
their own network, as well as to enterprises as part of the SIP
trunking services they subscribe to. But with three of the top UC
solutions developers now possessing SBC products of their own
(Cisco is the third), enterprises will start seeing SBCs pitched more
regularly as a standard component of the overall UC solution.

3.  There's been a considerable amount of activity in
the enterprise SBC space in the past year.
Developers of SIP-compliant PBXs have variously
partnered, acquired or developed their way into the
market. And smaller developers have seen in
enterprise SBCs a means of entering new markets,
adding new zest to an otherwise sluggish sales
record, and perhaps paving a path to being
acquired.

5.  Enterprise SBC developers come from a wide range of
backgrounds. Some developed routers for the
enterprise, others voice gateways or VoIP security
software. And developers of carrier-class SBCs have
gone downmarket, trying--and very much succeeding--
to sell into the enterprise space as well.
 Whereas the market for carrier SBCs went through a
period of consolidation in 2005-2006, the market for
enterprise SBCs is ripe for consolidation now. If I were a
betting man, I'd lay odds on 2012-2013 being the years
that we’re going to see a number of the many--20 by
some counts--small enterprise SBC developers either get
acquired or go out of business.

7.  Here's a snapshot of the formal business
relationships in place between enterprise
communications vendors on the one hand and
enterprise SBC developers on the other. It's not
meant to be comprehensive, so go ahead and pencil
in those I’ve overlooked...or better yet mention
them in Comments.

9.  And now a look at interoperability verification that
various enterprise SBC developers have done with
enterprise vendors' SIP-based communications
systems. Again, not meant to be comprehensive.

11.  So just how big of a pie are all these companies vying for?
Infonetics Research--more specifically Matthias Machowinksi--has
made a special study of this. His figures reveal a small but rapidly
growing market that has more than doubled in size in the last five
years. And looking forward, the hockey-stick growth curve seems
like it will remain firmly in place.
 Links:
E-SBC market is ~$40 million
7 out of 10 E-SBCs sold to businesses in US
E-SBC market is ~$61 million
E-SBCS market jumps 70%: ~$103 million
Acme Packet has 32% of E-SBC market; doubles its E-SBC business
Acme Packet & Cisco account for more than 50% of E-SBC market
Sipera and InGate in #3 & #4 spots SBC market is $541 million
In Q1 E-SBC market grows 55%
E-SBC market projected to be ~$300 million
E-SBC market to grow to ~$500 million

13.  To put things into perspective, the nascent market for
enterprise social software is already more than six times the
size of that for enterprise SBCs. The Text that's linked video
conferencing systems market is $2.2 billion annually, while
enterprise telephony systems rakes in about the same
amount per quarter. And the market for SBCs deployed by
service providers is nearly $300 million and projected to rise
to $1 billion before long.
 The point being, it's a comparatively meager pile of money
that developers of enterprise SBCs are grasping at.

Links: Enterprise telephony & UC equipment : $2.52 billion
Enterprise video conferencing & telepresence systems: $2.2
billion in 2010...$680 million just in Q3 2011
Enterprise social software: $664 million in 2010

15.  So given all the market activity and the rising importance of
SIP in today's communications networks, why is the
enterprise SBC market so tiny? Part of the problem is that a
lot of what enterprise SBCs do is already done by other
network elements. Edge routers can terminate SIP trunks.
Gateways can provide interworking. A variety of security
appliances provide varying degrees of protection. Session
managers manage sessions. And various application software
provides call recording, call accounting, billing and similar
services that can now run on enterprise SBCs.
 While it can be argued that enterprise SBCs consolidate
processes, doing them better in a more cost-effective way,
this doesn't detract from the fact enterprises need to make
new capital investments and to some degree redesign their
communications networks to accommodate them.

17.  Another reason for the market for SBCs being comparatively small: SIP is still not widely
adopted enough to warrant widespread adoption of enterprise SBCs. Wait, I didn't
phrase that quite right. It's not that SIP isn't widely adopted, it's that SIP isn't used end
to end across communications networks. Plus, each vendor and carrier has
implemented SIP slightly differently, leading to wide-ranging compatibility issues
among systems and services that can all say they are based on the standard.
 Contributing to the problem is all the finger-pointing among vendors that accuse their
competitors of not developing to the SIP standard. This makes adoption of SIP-based
systems and services unnecessarily complicated, which stymies adoption, which retards
demand for enterprise SBCs. And while the market for SIP trunking services is clearly on
the rise, it remains a fraction of the larger market for VoIP services. Until SIP trunking
becomes more mainstream, enterprise SBC sales are likely to suffer.
 Links
Links: ...enterprise customers were not ready to natively support SIP
Revenues from SIP trunking services grew 143% in 2010...but SIP trunking makes up
only 1% of the overall $50 billion VoIP services market-- Infonetics
$2 billion - Size of SIP and VoIP trunking services market--Frost & Sullivan
Lack of a widely adopted SIP trunking standard among service providers is an
impediment to enterprise adoption. Farzin Shahidi, NextPlane

19.  Despite this, the future in fact looks bright for the
burgeoning market for enterprise SBCs. Prices of systems are
being driven down, in part because of competition among
enterprise SBC developers. This will fuel enterprises'
continued interest in deploying them. Enterprise adoption of
SIP trunking services remains on the rise, with major carriers
now offering SIP trunking services of their own. And with all
business communications solution developers now offering
enterprise SBCs--whether their own or a partner's--for their
SIP-compliant platforms, businesses' adoption of them is
likely to increase steadily.
 Links:
"...the market for enterprise SBCs remains fragmented...."
"Without E-SBC, the adoption of SIP, UC and SIP trunking
becomes a difficult process..."

21. ???