SOURCE: IBM

February 14, 2007 06:00 ET

IBM Software Claims a Top Spot in Telecommunications Software, According to Analyst Firm

IBM Surpasses HP for Fault and Event Management Crown; Vallent Leads Performance Monitoring Revenue Share

ARMONK, NY -- (MARKET WIRE) -- February 14, 2007 -- IBM (NYSE: IBM) today announced that independent analyst firm OSS Observer has ranked IBM as the worldwide leader in the telecommunications software revenue for Fault and Event Management for operations support systems (OSS) which includes fixed, mobile and broadband segments(1).

IBM catapulted to outpace HP and Telcordia in this growing category. IBM's strong growth was fueled by a dual strategy of growing IBM's existing business as well as quickly integrating and growing its strategic acquisition of Micromuse and its Netcool technology.

According to the firm, the major trend shaping fault and event management is "consolidating network operations centers to achieve improved efficiencies in isolating problems and deciding on how to dispatch field resources." OSS Observer forecasts that fault and event management revenue will grow from $600 million in 2006 to $850 million in 2011, a CAGR of 7 percent.

Also according to OSS Observer, overall service assurance revenue will grow from $2.0 billion in 2006 to $3.0 billion in 2011 with a CAGR of 9 percent. The report states IBM appears in the top four ranking of the overall service assurance market because of its acquisition of Micromuse in 2006 and the firm expects buying Vallent will "further boost its position in service assurance."

Vallent, an IBM company, was ranked by OSS Observer as the worldwide revenue leader in performance monitoring, and was "the only ISV to generate more than $50 million in wireless performance monitoring market." The firm forecasts the performance monitoring market will grow from $383 million in 2006 to $580 million in 2011, a CAGR of 9 percent.

The quick integration and synergy between both existing IBM technology and Netcool software has boosted sales for IBM in telecommunications software. Many customers, such as Integra Telecom, a Portland, Ore. integrated communications carrier of voice and data services, are moving from HP to IBM.

"We decided to replace our HP software and migrate to IBM software because of the increased functionality and innovation IBM provides at a lower cost," said Julie Rouzee, CTO of Integra Telecom. "IBM has a strong service management portfolio and we understand why they are now recognized by OSS Observer as a market leader."

"Intense competition requires telecom providers to deliver faster service creation for an enhanced user experience, while stimulating revenue growth," said Al Zollar, General Manager of Tivoli Software at IBM. "IBM's breadth of service management offerings outpaces the competition in functionality. For example, we are finding that when IBM Netcool Precision IP is evaluated against HP Network Node Manager in a customer environment, 90 percent of the time, clients choose the IBM solution."

IBM Tivoli Netcool software has been selected by more than 1,000 service providers globally, including all 20 of the Top 20 carriers. The service providers include telecommunication providers, wireless providers, managed service providers, internet service providers, and other communication providers worldwide to monitor and manage their sophisticated technology infrastructures.

The software enables service providers to help ensure quality, reduce operational costs and speed time to market. The combination of Tivoli Netcool and IBM's service management technology provides customers with a comprehensive approach for reducing the complexity of their network requirements, lowering operational costs and addressing compliance.

With Vallent technology, IBM can now offer distinctive capabilities across wireline, wireless, IP, and IT infrastructure to help clients manage services end-to-end -- from the content server to the handset. Vallent further extends IBM's ability to help service providers address emerging opportunities in next generation network transformation, fixed/mobile convergence, and IP Multimedia Subsystem (IMS) deployment.

For more information about Tivoli Netcool software, visit http://www-306.ibm.com/software/tivoli/solutions/service-provider/.

For more information about Vallent, visit http://www-306.ibm.com/software/tivoli/welcome/vallent.

About IBM

More information on IBM can be found at www.ibm.com.

(1) OSS Observer, "Service Assurance Market Overview" by Patrick Kelly, February 2007.

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