There was a time when all a carrier had to do to meet demand was increase its bandwidth. But with average revenue per user (ARPU) trending flat, carriers are under increasing demand to get more out of their networks than an increase in bandwidth will provide.
The answer, according to Yankee Group analyst Mark Bieberich, is policy control. Bieberich explained on a conference call with journalists that policy management describes functions associated with network attachment, call session, resource and admission control among other policy containers.
It's a market that Yankee has forecast to be worth $100 million in 2007, growing to $700 million by the end of 2010.
"The key driver is that policy management and real-time network resource control are codified in certain standards like IMS (define), and, as service providers embrace the standards, they'll have policy management in conjunction with that," Bieberich said.
But even without the widespread deployment of IMS (IP Multimedia Subsystem), which is an architectural framework for delivering voice, video and data over IP, network policy deployment is growing.
"We see it deployed now in standards and pre-standards environments, though standards will help maturation," Bieberich said.
Yankee Group sees policy-enabled service control layers for carrier networks sandwiched between the core IP transport layer and the application layer. Policy there becomes the conduit across which application and services traverse the IP network.
Network policy in essence makes the network more aware and in control of the traffic and users that are connected to it. What policy control enables from a bandwidth point of view is better utilization so on-demand services can be provisioned with on-demand bandwidth.
Bieberich also argued that carriers could take advantage of granular network policy control to create new revenue sources, such as targeted advertising.
In the case of IPTV, network policy could enable a way of targeting particular content advertising to end users based on policies since the network policy engine would have access to usage patterns and demographics data. So advertisers could place target customers they are really after.