As this year's projected 3G subscriber numbers push through the 50 million mark worldwide, at least one CEO will be watching with quiet satisfaction: Dilithium Networks' Paul Zuber. Why? Because 3G will demand both interoperability and high quality of service--whatever the application and whatever the terminal.

"Where we fit is in this area of media processing," says Zuber. "There's always going to be a need to mediate between different standards". But doesn't convergence deal with that issue? "No," says Zuber, "there is divergence. When I think of convergence, it is not between mobile and fixed. The big bang convergence that's happening out there is in consumer electronics, telecom and the IT world. They all have differing standards and that's a very good opportunity for us."

Dilithium has a set of 3G solutions including multimedia transcoding gateways, 3G-324M protocol analysis test tools, and 3G-324M protocols stacks. What, however, might shoot the company up the success curve is its video telephony work. "If you look at some of the launches that were delayed, you see that some basic issues such as terminal interoperability, session set-up times, and over-the-air corruption of video messages took a while to solve," says Zuber.

Mobile video may--arguably--be the most complex telecom proposition ever delivered to users. Service options will range from simple video peer-to-peer videoconferencing, through video mail, and video portal applications. "If I think about our core expertise, we are the world leader in voice and video transcoding, and in 3G-324M, which is the world standard for mobile video telephony," says Zuber, "But whilst everyone is focussing on IP, this will be a multi-year transition for service providers."

The products may look disparate, but Zuber defends a strategy where each element contributes to the other. "As operators launch enhanced services where our gateway will play a vital role, we have tools that help operators solve basic but fundamental issues such as enabling interoperability of terminals and network equipment, monitoring quality of service, and providing key performance indicators and quality metrics for deployed video services. Initially, we, and the market, were focussed on industry interoperability. Then there were some optimisation issues. Now, as services are being launched, the focus is switching to QoS and related user experience issues."

Industrial investors have joined VCs in backing a company that might have one of the few market drivers under its belt. In squeezing performance out of its DTG 2000 multimedia gateway, Dilithium, says Zuber, can offer superior coding technology to improve lip synchronisation and audio/video delays, patentpending technology to reduce session set-up times to less than one second (well below 8-10 seconds experienced elsewhere), and video refresh and transrating that minimise video corruption, and modify video bit rates to maintain video quality. The net result is a superior customer experience and lower operational costs.

Dilithium, unusually for a young US company, focuses mostly on overseas markets, particularly in Asia and Europe, where it has connections with service providers running the sort of leading edge service not yet apparent in the US market. The company serves customers in more than 40 countries. They include the majority of leading terminal, network equipment, and messaging vendors as well as the leading 3G operators in Europe and Asia. A joint collaboration agreement with Japan's N'IT DoCoMo--announced in March--will enable development of 3G terminal test cases to advance video telephony interoperability test solutions, and support new handset development. The company also counts SK Telecom, KTF, China Mobile, Vodafone, Orange, H3G, TIM and KPN among its customers.