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Verizon's Next With VNFs

Carol Wilson
7/21/2016
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Verizon Enterprise Solutions today announced its first set of virtual network services, including the usual suspects of security, WAN optimization, software-defined WANs and virtualized customer premises gear. Working with mostly established vendors, Verizon is making its services available globally on an immediate basis, and focusing heavily on giving customers lots of options for how they transition to the virtualized world. (See Verizon Launches Virtual Network Services.)

The announcement comes four days after AT&T Inc. (NYSE: T) introduced its Network Functions on Demand offer, and differences between the two services are apparent and strategic, notes Nav Chander, research manager for telecom business services with IDC. (See AT&T Offers Network Functions On Demand... Sort Of.)

"All the Tier 1 carriers and these two in particular see that they don't have a choice [about moving to virtualization] but they are taking different paths," Chander notes. "AT&T is determined to build their own architecture, even if it is open source, with white boxes, so their platform is vendor-agnostic. Verizon is taking more of a pragmatic approach, partnering with vendors to build a portfolio of virtualized solutions, embracing SD-WANs and not trying to protect their installed base of IP-MPLS."

Verizon Enterprise Solutions is working mainly with the traditional vendors that would be familiar to most enterprises, including Cisco Systems Inc. (Nasdaq: CSCO) and Juniper Networks Inc. (NYSE: JNPR) on virtual CPE, virtual routing and security; Riverbed Technology Inc. (Nasdaq: RVBD) and Cisco on WAN optimization; Cisco and Viptela on SD-WANs, and Fortinet Inc. and Palo Alto Networks Inc. on security as well.

Verizon's approach is based on giving its customers the efficiency and agility in network services that they have already gained by virtualizing their IT infrastructure, notes Vickie Lonker, director of product and new business for Verizon Enterprise Solutions. And while customer choice is another hallmark of the Verizon Virtual Network Services, all the offerings are delivered from an integrated managed services platform.


Get up close and personal with service provider NFV strategies in our NFV Elements section here on Light Reading.

Customers first choose their network service, either SD-WAN or a traditional service, and then get to choose their deployment model, she says. That can be premises-based universal CPE, where functions can be added as software, or it can be cloud-based virtual CPE or it can be a hybrid approach, which is expected to be the most popular option. Customers then choose which virtual functions they want from the first three available: security, WAN optimization and advanced routing.

Those are services already offered by some companies and it's not surprising they are part of Verizon's package. "We wanted to start with what was most mature today," Lonker says.

Everything is delivered on-demand, with pay-as-you-go pricing based on consumption -- another contrast with AT&T, which is using a more traditional pricing model.

As Ovum Analyst Mike Sapien notes, however, the real differentiation for service providers in this space is going to be how well they execute on the strategy to deliver VNFs and the level of care they provide customers, from the pre-sales stage through to troubleshooting problems and managing the upgrade cycles.

"When they can turn on cloud compute and storage, enterprises also want to be able to turn on network services and know they are there, without long provisioning times," he says. "Right now, [carriers] are mostly dealing with eagerly interested larger enterprises, who are heavily staffed and can put the resources into making this work. That isn't going to be true of smaller customers. The network operators will need to be an advisor to their customers -- when you give customer all these choices, they will need a trusted advisor to sort things out."

Lonker says Verizon will be adding new features on a regular basis, using a DevOps model to constantly iterate its software to improve it and expand service offerings. Analyst Sapien notes that's a new way of working for network operators and will have its own execution challenges -- the companies that manage that potentially complex process more successfully will stand out in what is expected to be a crowded market.

One benefit for Verizon customers of the "as-a-service" model is that they don't have to worry about software licenses or long-term contracts, Lonker notes.

"That's extremely important -- there are no licenses, we can offer complete portability, with no long-term contracts," she comments. "If they need to close a site and move a firewall, they can do that. We have tried to make it extremely easy, working with a very robust portfolio of vendor partners and functions we are offering and combinations of functions that work together. Our vendors are able to offer us flexibility and we are sharing that with our customers."

The other differentiator for Verizon is the SD-WAN element and its importance in the bigger mix. IDC's Chander says AT&T is shying away from SD-WANs, but Verizon is embracing that technology.

"We believe that is important, because customers can start with an SD-WAN and add other virtual network functions on top of it," Lonker notes. "Or if they have SD-WAN gear on premises, they can use that also. I can service chain things together for them."

That doesn't even have to happen on Verizon's network, she says, although obviously that would be the preference. "They can still have virtualized functions -- we're agnostic as to where they start, it doesn't have to be with Verizon's network."

Ovum's Sapien believes the network element could prove to be a differentiating factor for companies such as AT&T and Verizon over managed service providers that don't control the network and are increasingly competing for the VNF business. "It should be an advantage, the fact that they could respond more quickly to network changes, and control that process, if they integrate things correctly, he notes.

— Carol Wilson, Editor-at-Large, Light Reading

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Atlantis-dude
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Atlantis-dude,
User Rank: Light Sabre
7/23/2016 | 9:11:44 PM
Re: Orchestration layer?
simlar to ecomp do they have anything homegrown?
Atlantis-dude
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Atlantis-dude,
User Rank: Light Sabre
7/23/2016 | 9:08:43 PM
which vnfs are
likelly to be on prem and which are likeyly to be cloud based? have they described it for the hybrid model?
Faisal Khan
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Faisal Khan,
User Rank: Blogger
7/23/2016 | 8:11:57 AM
Orchestration layer?
Interesting analysis between Verizon and AT&T, Does any one know the vendor for the orchestration layer for Verizon?
cnwedit
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cnwedit,
User Rank: Light Beer
7/21/2016 | 2:44:28 PM
Re: Interesting NFV timing/comparisons
I honestly don't know that Verizon's approach doesn't work long-term as well. But AT&T's heavy investment in open source and vendor-neutral platforms seems to require more work in the near-term, in hopes of a longer-term payoff. 
Joe Stanganelli
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Joe Stanganelli,
User Rank: Light Sabre
7/21/2016 | 10:07:42 AM
Re: Interesting NFV timing/comparisons
I think they're both playing for the long game, but AT&T may be taking a more long-term and less near-term focused approach here because they've realized that first-to-market doesn't mean a whole heck of a lot if the competition can come in with a FAR more outstanding and heavily evangelized platform-enhanced product down the line.
Joe Stanganelli
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Joe Stanganelli,
User Rank: Light Sabre
7/21/2016 | 10:06:18 AM
Re: Interesting NFV timing/comparisons
@Ray: And from a punditry/industry-watcher perspective, it's fascinating to watch this arms race fold out between these two telco giants -- not just here in the network, but also in the platforms, the DevOps, and IoT ops/functionalities.

Interesting to note, for instance, that whereas AT&T's M2X beat VZ's ThingSpace to market by about six months, the latter seems to have a lot more going on with it these days (or, at least, seems to be promising to do so in the near future).
cnwedit
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50%
cnwedit,
User Rank: Light Beer
7/21/2016 | 9:13:20 AM
Re: Interesting NFV timing/comparisons
AT&T is clearly investing in a platform for the long-term - the open source investment and the software development as well is all intended to give them something truly vendor agnostic. The issue will be how they compete in the near term. As Nav Chander points out, Verizon's approach is more tactical for the near-term realities. 
Ray@LR
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Ray@LR,
User Rank: Blogger
7/21/2016 | 8:15:43 AM
Interesting NFV timing/comparisons
Very interesting to see the similarities and differences between the two top US operators -- now the customers get to weigh these and other options.... or maybe they sit back a moment to see who does what.
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