A new report from communications market research firm Infonetics Research shows that worldwide next gen voice equipment sales totaled $985 million in 1Q08, down 12% from the previous quarter, but up 17% from a year ago. The healthy year-over-year increase indicates service providers continue to invest in VoIP equipment as part of their long term migration from circuit switched to packet telephony, says the report.

Nokia Siemens Networks gained 5 points in the combined worldwide media gateway and softswitch segment of the carrier VoIP market in 1Q08 from 4Q07, while Nortel is down 2 points. The market share shifts bring Nortel -- the perennial front runner in the worldwide carrier VoIP market -- and Nokia Siemens within 1 point of each other for the first time, according to the report.

"There were some interesting market share battles in the service provider VoIP market in the first quarter of 2008. In addition to the Nortel-Nokia Siemens battle in the media gateway/softswitch segment, GENBAND shook up the trunk media gateway segment with a 111% sequential jump in worldwide DS0 shipments, propelling them from 4th to 1st in DS0 shipments and from 7th to 4th in revenue. Meanwhile, Sonus and Cisco continue to go head to head over worldwide trunk media gateway revenue," said Stéphane Téral, principal analyst for VoIP and IMS at Infonetics Research.

"On the IMS front, our discussions with service providers confirm that fixed-line VoIP is the major application being offered over IMS networks, and IMS deployments still consist of the deployment of an HSS, a CSCF, and 1 application server per application at this point, which in fact turns out to be a traditional voice application server," Téral added.

Other highlights from the report:

Session border controllers (SBCs), media servers, and class 4 softswitches are the only segments of the carrier VoIP market posting sequential worldwide revenue growth in 1Q08
All segments of the carrier VoIP market show healthy to very strong growth in revenue from a year ago (SBCs are up 50% in 1Q08 from 1Q07)
The trunk media gateway segment is being driven by strong voice over broadband deployments; media servers are mainly driven by North American tier 1 service provider deployments
There were 75 million residential and SOHO VoIP subscribers worldwide in 2007