Light Reading

NFV: Set to Break the Big Box Brands

Heavy Lifting Analyst Notes
Heavy Lifting Analyst Notes
Heavy Lifting Analyst Notes

The relationship between existing vendors of network equipment and telecom network operators is set to change dramatically if operators' visions of the future are realized. Network functions virtualization (NFV) involves taking telecom network functions -- traditionally delivered in proprietary devices -- virtualizing them and running across shared common off-the-shelf (COTS) servers, storage devices and Ethernet switches. It is a vision backed by many of the world's biggest telcos -- a group that represents many, many billions of dollars of annual capex -- and that makes it very hard for network equipment providers to ignore.

Operators have seen how cloud computing, virtualization and new approaches to running global cloud-based service operations have revolutionized enterprise networking and computing. They want to use the same technologies to drive down their own capex and opex, and to change the way they manage their service businesses.

It will take time -- many years, in fact -- for the physical changes to the infrastructure to become embedded; these changes will happen incrementally. But the physical changes will be just the start of the process. There will also be changes in the way operators interact with vendors and the way they buy solutions from them. NFV has the potential to lead to a new wave of market fragmentation. Over the last 10 years, observers of the operations/business support system (OSS/BSS) market have witnessed a tremendous amount of consolidation. Many smaller OSS/BSS providers have failed or have been acquired, but the widespread migration of network functions onto virtualized infrastructures opens up an opportunity for any company with clever people writing code to develop solutions that can be deployed on standard platforms. There will be a proliferation of innovative start-ups claiming that they can build a better piece of software, which is easy for telcos to try. There is tremendous potential for a new wave of innovation and fragmentation.

Where does this leave the old guard? Well, for a start, operators will expect all the independent software providers, network equipment providers and anyone else they work with to integrate their solutions with the telecom operators' virtualization middleware. Some will attempt to run this middleware themselves; many more will look to outsource the operation of this. The entrenched network equipment providers and systems integrators are already fighting very hard to be these gatekeepers: that is, the companies operating that virtualization middleware.

Operators will also demand that network functions software meets stringent service-level agreements (SLAs), and this is likely to be one of the primary levers the established players will use to retain their share of the market. Network function providers will all be required to attain those SLAs on equipment delivered and maintained by third parties. This will change the contractual relationship with network operators in ways that are hard to predict; but the bigger providers will have the resources to do more testing and more certification and validation, and -- of course -- they will have a head start on rivals and more control over their own destinies if they are running those middleware platforms.

Old players that don't change their ways will die out in the newly virtualizing telecom world. Those that adapt will find a new role. The latest Heavy Reading Insider, "Picking Winners From the NFV Revolution," takes an in-depth look at the potential benefits of NFV for operators, and at how the major network equipment providers are evolving their strategies so they can continue to serve their clients in the future. It includes profiles of network equipment providers, systems integrators and independent software providers that have been swift to develop NFV visions and solutions.

— Simon Sherrington, Analyst, Heavy Reading Insider

Picking Winners From the NFV Revolution, a 25-page report, is available as part of an annual subscription (12 monthly issues) to Heavy Reading Insider, priced at $1,595. This report is available for $900. To subscribe, please visit:

(1)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
User Rank: Light Beer
8/12/2013 | 8:41:35 PM
re: NFV: Set to Break the Big Box Brands
Simon, Report looks to be interesting. Couple of blogs I wrote recently on VNF trends I have seen, related to points you make, in the market may be of interest to you/readers:
Educational Resources
sponsor supplied content
Educational Resources Archive
More Blogs from Heavy Lifting Analyst Notes
FPGA and ASIC usage grows in the telecom market. FPGAs and ASICs are widely used in networking and telecom systems, from complete SoC designs to simple connections between different interfaces on merchant silicon devices.
The research and development (R&D) race is on for 5G, with many vendors working toward a common goal: developing the technologies that will become 5G and its industry standards.
Huawei joins a slew of equipment vendors seeking to make their mark in the North American cable space with products for both cable's new DOCSIS gigabit spec and CCAP.
Now that cable operators have invested heavily in WiFi, the big question is how they can optimize and monetize their wireless networks most effectively.
Facebook software engineer Paul Saab revealed that IPv6 now accounts for almost 50% of Facebook's 4G smartphone traffic in the US – and that's just the start of it.
From The Founder
The comms industry is rallying to the cause of open, independent interoperability testing.
Flash Poll
Live Streaming Video
CLOUD / MANAGED SERVICES: Prepping Ethernet for the Cloud
Moderator: Ray LeMaistre Panelists: Jeremy Bye, Leonard Sheahan
LRTV Interviews
Top Tips for FTTH Operators

10|8|15   |   02:26   |   (0) comments

At Gigabit Europe 2015, Ventura Team co-founder Richard Jones talks about some of the key business case considerations for FTTH network operators.
LRTV Interviews
M-net Calls for FTTx Unity

10|8|15   |   03:45   |   (0) comments

At the Gigabit Europe event, Jörn Schoof from M-net, the Munich city network operator, calls for industry collaboration on fiber broadband access rollouts.
LRTV Documentaries
The Business Case Challenge for NFV

10|7|15   |   03:47   |   (0) comments

Virtual CPE is one of the early success stories for network functions virtualization, as service providers are finding flexible, programmable CPE solves a lot of logistics problems and reduces their cost. But even here, Masergy Communications faced a business case challenge, says CTO Tim Naramore.
LRTV Interviews
JT Offers Some Gigabit Lessons

10|7|15   |   4:08   |   (1) comment

Barna Kutvolgyi, managing director, Global Consumer, at JT, the incumbent operator on the island of Jersey, talks about how other service providers can learn from his company's gigabit broadband rollout experiences.
LRTV Interviews
AT&T's Chiosi on the Potential of Open Source

10|6|15   |   06:27   |   (0) comments

AT&T Distinguished Network Architect Margaret T. Chiosi talks to Light Reading's Carol Wilson about the potential for open source technology to liberate communications service providers.
LRTV Interviews
Network Security in a Gigabit World

10|6|15   |   05:52   |   (0) comments

Masergy's James Harrison talks about some of the network security and data center issues network operators need to consider as they expand their broadband services portfolios.
LRTV Documentaries
Telefónica: In Search of Virtual Simplicity

10|5|15   |   07:30   |   (0) comments

Francisco-Javier Ramon Salguero, head of Telefónica's NFV initiative, admits virtualization initially means greater complexity, but with the right abstraction layer, it is possible to create a services-driven network architecture. He explains how Telefónica's current trials and initiatives are aimed at doing that, and what his company and other carriers need to ...
LRTV Interviews
Gigabit Europe Takeaways

10|5|15   |   03:47   |   (0) comments

Participants from the inaugural Gigabit Europe event in Munich share their key takeaways from the conference.
Women in Comms Introduction Videos
Intel Urges Women to Take Advantage of Their Seat at the Table

10|5|15   |   4:27   |   (1) comment

Have inclusive and constructive conversations, attach a bigger meaning to your work and get involved in the cause, Intel's Monique Hayward advises women in comms.
LRTV Interviews
BT Updates on Plans

10|2|15   |   03:16   |   (2) comments

Peter Bell, CIO at Openreach, the access network division at UK incumbent BT, provides an update on the operator's trials and how Openreach is planning to deploy the broadband technology in its street cabinets.
Telecom Innovators Video Showcase
Sonus Shakes Up SD-WAN

10|2|15   |   7:22   |   (0) comments

Sonus CTO Kevin Riley sat down with Light Reading to discuss the trajectory of the company, its SDN ambitions and why Sonus is taking a market-disruptive approve to SD-WAN.
LRTV Interviews
CityFibre's Gigabit Vision

10|1|15   |   03:18   |   (1) comment

Mark Collins, director of Strategy & Public Affairs at competitive UK city network operator CityFibre, talks about his company's plans to help build Gigabit Cities.
Upcoming Live Events
October 14-15, 2015, New Orleans Ernest N. Morial Convention Center, New Orleans, LA
November 5, 2015, Hilton Santa Clara, Santa Clara, CA
November 17, 2015, Santa Clara, California
December 1, 2015, The Westin Times Square, New York City
December 2, 2015, The Westin Times Square, New York City
All Upcoming Live Events
Network appliances have a strong value proposition in today's networks and will continue to do so in the NFV and SDN-enabled networks of tomorrow.
Hot Topics
Verizon's Go90 Is Live – Will Anyone Watch?
Mari Silbey, Senior Editor, Cable/Video, 10/1/2015
Eurobites: Dunroamin'
Paul Rainford, Assistant Editor, Europe, 10/2/2015
M&A Speculation Swirls Around Juniper
Ray Le Maistre, Editor-in-chief, 10/6/2015
Cisco's Chambers Rules Out Political Bid
Mitch Wagner, West Coast Bureau Chief, Light Reading, 10/6/2015
AlcaLu Execs Lose Out as Nokia Unveils New Top Team
Iain Morris, News Editor, 10/7/2015
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
With so many new and exciting communications technologies now under development, it's easy to get caught up in the industry's escalating hype cycle. That's why the ...
Last week saw a big day in the 15-year history of Light Reading when Editor-in-Chief Ray Le Maistre and I were invited to interview the Deputy Chairman and Rotating ...
Cats with Phones
"What?! I'm on with Finisar about their stock price tanking" Click Here