NFV/SDN will separate Telecom hardware from software and as result, e Equipment Vendors(EV) may become merely
software suppliers. At first glance, we feel that EV will dislike the idea of
NFV/SDN since its reducing ambit of their business. But in that’s not the case, as
it seems.
Look at the following news stories:
·
Swedish communications technology and services
provider giant Ericsson has signed a five-year software licensing deal with
Mirantis that is worth a reported $30 million and is thought to be the largest
OpenStack-related deal on record. (https://www.mirantis.com/openstack-portal/external-news/ericsson-engages-mirantis-record-breaking-openstack-deal/
)
·
Mirantis and Juniper Networks are partnering to
enable rapid delivery of high-performance, massively-scalable OpenStack clouds
with Juniper Contrail software-defined networking (SDN).( https://www.mirantis.com/partners/mirantis-technology-partners/mirantis-partners-juniper/
)
·
Huawei Technologies Co. Ltd. outlined its
"SoftCOM" software-defined networking (SDN) strategy to industry
analysts and media in London. (http://www.lightreading.com/carrier-sdn/sdn-architectures/huawei-unfolds-sdn-roadmap/d/d-id/701139)
Emerging Business Case
When Telcos move to NFV/SDN domain, they will use
commoditized hardware for cost benefits, while they need to set-up cloud
orchestration platform for virtual applications, thus software expense will be
higher. As shown in chart below, in NFV/SDN domain Telco’s hardware expense will decrease, but correspondingly software expense will rise, due to Cloud orchestration
platform development. Software SDLC has higher operational cost(upgrades,
feature expansion, etc) than hardware. EVs seeing their profits coming from software plug-ins & services, rather than
traditional hardware/software integrated box. 
EVs are targeting Telco’s cloud architecture to find newer
opportunities. Openstack will be first choice for cloud management as its
no-cost, open sourced and available for
Telco specific customization. Ericsson and Juniper have designed their cloud
platform integrated with Openstack APIs and announced partnership with
Mirantis, leading Openstack distributor. Including Openstack their offering, EVs are claiming
their product .. cloud-ready.
Openstack
Neutron Plug In
Cloud manager, Openstack will provide API framework to
configure hypervisors, storage and network elements. Openstack network service,
called Neutron API will configure EV’s virtualized network applications
(Switches, routers etc) . EVs have developed Openstack Neutron specific
plug-ins to integrate with Neutron API service. This plug-in will pass API
calls to hardware switches (as Arista) or to SDN controller as open contrail,
Nuage etc.
In either case EV’s core business will remain to provide
network functionality. This time though Neutron plug-in, SDN and SDN agent as
vSwitch, Open Vswitch or vRouter at hypervisor,
rather than proprietary integrated
appliance.
Neutron Plug-in upgrades, API enhancement and SDN Application development will be ongoing service
business for EVs the same way as current licensed software upgrades
Most of EVs have already have clear SDN offerings, as
Juniper OpenContrail, ALU Nuage SDN controller, Huawei’s ONOS Softcome
controller, NEC Programmable flow-controller etc
EV Cloud
NFV SDN will enable EV to have their own cloud for Tier 2/3 Telcos MVNOs ,Enterprise customers etc. In stead of
deploying and managing physical boxes on-premise, EV can share its products’ virtual
instances with customers, saving significant Capex and Opex. Cloud enabled
managed services will open new business opportunities for both Telcos and
Vendors, as shown in figure below:
Summary
In NFV/SDN world, EVs will compensate their loss
in hardware by offering cloud specific software products as Neutron Plugin, SDN
Applications and its hypervisor agents. Software based products will require
cyclic upgrades and feature enhancements, as in traditional network, which will
keep Telecom ecosystem evolving. EVs who can adapt changed conditions, will
survive. Surely NFV/SDN will break the
closed telecom ecosystem and bring new players (e.g. Affirmed Networks) who
will challenge established Telecom Equipment Vendors. Innovation will thrive
and competition will be stiff
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