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Carriers are taking the lead for data center virtualization, leaving vendors to catch up, say Heavy Reading analysts Roz Roseboro and Jim Hodges.

Data Center Virtualization: Tough for Carriers, Tougher for Vendors

Mitch Wagner
8/4/2014
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Welcome to telco data center month here at Light Reading. Throughout August, we'll be taking a close look at the technology, people, and business issues driving change at carrier data centers.

To kick things off, we talked to two of the sector's key experts on carrier data centers: Jim Hodges and Roz Roseboro are both senior analysts at Heavy Reading , specializing in data center issues.

So what are the major technology and business issues driving telco data center transformation?

Jim and Roz laugh. "SDN and NFV," they say, nearly at the same time.

"I guess we're done then," I say. "Thanks for your time. Bye now!"

OK, so I didn't say that... it's not that clear cut.

Carriers are deep into the process of virtualizing their server and storage infrastructure, and are now beginning to virtualize the network, Roseboro explains.

That's true in many industries, but it's a particular challenge for carriers, which face high availability, security, and regulatory requirements that do not constrain companies in other sectors, Hodges says.

Carriers need to move methodically, because virtualizing requires deep cultural change, Roseboro adds.

Both carriers and vendors need to move from managing hardware to software. "Operators are currently managing lots of boxes and they're moving on to manage software, requiring different tools and processes," Roseboro says.

SDN and NFV are two faces of virtualization. Of the two, NFV is moving faster, in part because NFV is being driven by network operators, with a key group of major telcos -- AT&T Inc. (NYSE: T), BT Group plc (NYSE: BT; London: BTA), Deutsche Telekom AG (NYSE: DT), KDDI Corp. , NTT Communications Corp. (NYSE: NTT), Orange (NYSE: FTE), Telefónica SA (NYSE: TEF), and Verizon Communications Inc. (NYSE: VZ), among others -- having published a white paper in 2012 laying out their demands. "Operators have been clear about their desire to move away from proprietary hardware solutions," Roseboro says. (See Defining SDN & NFV.)

Carrier-driven disruption is rare, says Hodges. In the past, disruptive technology came from outside; it's something the carriers could not control. "It's a major switch to the telco business model, but it's being driven by the telcos in many respects," Hodges says. "In some respects, NFV is more disruptive to the vendor communities."

Roseboro says she's been hearing from carriers that it's harder to make a business case for SDN than for NFV, because SDN's primary benefit -- at least for now -- is reducing opex. "Carriers will invest to increase revenue. It's hard to get people to invest to save money," she says.

So which carriers are leading the move to virtualization? It's hard to say.

All the Tier 1 carriers have ongoing programs, "because they realize this is their architecture of the future," and it's very much a global process, Hodges says: The operators that signed the NFV white paper in many respects have set the pace, he notes.

Operators are putting virtual firewalls and other appliances at the edge of the network to take their first steps toward NFV, but core functions have yet to be specced out, Roseboro says, adding that it's too early in the virtualization transition to identify and name leaders.


Find out more about how NFV is shaping the data center -- join us for our NFV & the Data Center event Sept. 16 in Santa Clara.


Look out during the rest of the month for more coverage of telco data center issues and developments, including features on the top people and vendors leading the transition.

And for further reading, check out these NFV and SDN articles on Light Reading:

— Mitch Wagner, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profileFollow me on Facebook, West Coast Bureau Chief, Light Reading. Got a tip about SDN or NFV? Send it to wagner@lightreading.com.

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