The GSMA IPX

Today's blog is a continuation of the discussion about Next Generation Network (NGN) interconnect. While there is a lot of discussion about the promise of replacing the Public Switch Telephone Network (PSTN) with an all IP network, few efforts seem to be getting past the discussion phase. The GSM Association's IPX effort, however, appears to have some real momentum. The GSM Association (GSMA) is the global association of wireless carriers who use the GSM wireless technology developed by ETSI. The majority of wireless users worldwide are on GSM networks. Since the number of wireless users surpass the number landline users, the GSMA is well positioned to define a NGN architecture which could replace the PSTN.

The GSMA' s proposed architecture for NGN interconnection is its IP eXchange or IPX. It is a grandiose plan that appears to address every possible carrier requirement. It appears so grandiose in fact that some may believe it will never happen. However, I think betting against the GSMA IPX would be a mistake. The concept was first publicized in 2006 and in February 2008 the first trials of the IPX were announced. One unique aspect of the IPX plan is that it addresses the requirement of intercarrier settlements upfront. If the IPX enables cascading settlement transactions among carriers, then the economic incentives will be in place to encourage open interconnect among carriers.

Today most carriers continue to interconnect via PSTN SS7 networks because it offers a proven economic model for interconnect compensation. However, carriers will follow the money. If the IPX has a better economic model for interconnect, then the IPX is positioned to replace the PSTN as the global voice network.