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NFV (Network functions virtualization)

Stop "Overselling" SDN, Orange Tells Vendors

DUSSELDORF -- SDN Openflow World Congress -- France's Orange is accusing vendors of undermining the business case for SDN and NFV by "overselling" the technologies and fueling unrealistic expectations at Board level.

Vendors of the NewIP technologies have been making some bold claims about the cost savings and service-related benefits operators can realize from investing in network functions virtualization (NFV) and software-defined networking (SDN).

Although Orange (NYSE: FTE) remains as interested in taking advantage of these technologies as other service providers, it lashed out at the vendor community during this week's SDN Openflow World Congress in Dusseldorf for hyping the business case.

"Overselling SDN and NFV is counterproductive," said Noël Foret, Orange's vice president of network control, during a keynote session on Tuesday morning. "It may lead to a cut in investment as a consequence of overestimated savings, and it may generate disappointment and frustration."

Foret hinted that some of his recent conversations at the board level have been less than comfortable because financial executives have been led to believe SDN and NFV can generate much bigger cost savings than are feasible.

The French operator has been changing its approach to the deployment of SDN and NFV to identify more realistic "business drivers" for the move.

"The original message from some vendors about cost savings was a very fine story but it is not really what we see today," explained Foret.

The update from the Orange executive will be a troubling one for many SDN and NFV suppliers, which are desperate to see their products gain traction in the market.

But Foret is not the only service provider with reservations about the sales patter from SDN and NFV vendors.

"I see a lot of sales pitches out there about how you can stop using this kind of connectivity and start using this one and I can tell those vendors haven't actually sold anything because that's not the use case," said Shawn Hakl, vice president of enterprise networking and innovation at Verizon Enterprise Solutions , during a separate keynote.

"You can't turn a zebra into a horse with this technology -- underlying connectivity still matters," added Hakl. "What it does mean is that instead of linking performance and cost to the site type you can link those choices at the application layer, and that's what matters in terms of the trade-offs."

Orange's Foret also complained about the proliferation of "clubs" in the SDN and NFV industry, expressing concern about the risk of fragmentation with so many standards bodies now active in the market.

"It's good that clubs exist but we need to find a place where they can come with their activities to reach convergence," he said.


Want to know more about the emerging SDN market? Check out our dedicated SDN content channel here on Light Reading.


Orange and Verizon are among a number of service providers gathered at this week's Dusseldorf event that have taken some early steps in deploying SDN- and NFV-based services.

Earlier this year, the French incumbent announced details of a service for small- and mid-sized businesses that makes use of SDN and NFV technologies and is being offered under the EasyConnect brand. (See Orange Unveils NFV-Based Offering for SMBs.)

Verizon, meanwhile, introduced an SDN-based wide area network service in partnership with Cisco Systems Inc. (Nasdaq: CSCO) a few weeks ago, allowing enterprises to connect employees to business applications regardless of their location. (See Verizon, Cisco Launch Smarter WAN.)

Hakl's update on the response to that rollout could offer some encouragement to vendors gathered at Tuesday's show.

"We have signed tens of millions of dollars in contracts since we launched for customers crossing the US into Europe," he told attendees.

Earlier on Tuesday, Deutsche Telekom AG (NYSE: DT) and Vodafone Group plc (NYSE: VOD) both announced plans for the launch of VPN services based on the use of SDN and NFV technologies. (See DT, Vodafone to Launch SDN-Based VPNs.)

Operators have themselves been cagey about the cost savings they expect to realize from New IP technologies, but a white paper from management consultancy firm Arthur D. Little and Alcatel-Lucent (NYSE: ALU) R&D arm Bell Labs estimates that European Union service providers could save about €14 billion ($15.9 billion) annually -- or 10% of total industry opex -- from the use of SDN and NFV. (See Will Investing in SDN & NFV Be Worth It?.)

— Iain Morris, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, News Editor, Light Reading

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MordyK 10/27/2015 | 6:42:52 AM
Re: Time to lay this argument to rest And yet while calling bull on savings element, Orange is still fully commited to migrating their networks to a new IP architecture. This tells me that the implemetors and decision makers are tired of getting pressured from the executive suite about the efects on their P&L statements.
kq4ym 10/26/2015 | 9:29:11 PM
Re: Time to lay this argument to rest But interesting that Orange is taking the argument over savings head on. With the pitch that sales folks are leading ciients to " believe SDN and NFV can generate much bigger cost savings than are feasible," Orange is certainly going to put some caution in the minds to those ready to join the SDN caravan.
MordyK 10/14/2015 | 11:16:29 AM
Re: Time to lay this argument to rest Glad I managed to clarify my point!
brooks7 10/14/2015 | 10:10:18 AM
Re: Time to lay this argument to rest Sheesh, took me all that to get you to post your actual view!

I didn't think you were flip flopping, just wanted you to say what you mean!

seven

 
MordyK 10/14/2015 | 12:41:12 AM
Re: Time to lay this argument to rest Seven,

There are 2 forms of efficiencies: 1. you get more from the same cost which creates growth. or 2. you reduce overhead and retain the status quo. A struggling enterprise looks for savings to reduce the burn rate, while successfull companies see freed up resources as a license and budget to tackle new opportunities.

Telco's are pretty rich, so I would believe they would go for growth, especilly as we approach the convergence of 4.5-5G and IoT which present new opportunities along with new complexities. If you don't move to a new IP platform, the cost of IoT and 5G becomes extremely prohibitive.

Therefore, if you're gonna be spending the money anyways, you may as well go early - if its fully baked - and get some more of those efficiencies.

I believes this explains my thinking and prevents me from being labelled a flip-flop. :)

Mordy
brooks7 10/14/2015 | 12:30:39 AM
Re: Time to lay this argument to rest mordyk,

But that is what you are saying.  They get to lay people off.  That is what opex savings are.  So, either they get to save money or they don't.  Fewer people is what opex savings are.  That is what you have said and then denied.  Make up your mind.

seven

 
MordyK 10/13/2015 | 11:56:26 PM
Re: Time to lay this argument to rest I'm not saying that the operational efficiencies are not there, but in the short-term the costs involved in the migration are also pretty high. So if there are savings I would think they are miniscule.

That said every time you need to provision something that required weeks to process that can now be done on the fly is an opportunity to save cost or generate new revenue. 

In the long term however, the new IP route which includes SDN and NFV gives free reign for departments to innovate on the cheap and rapidly and leverage opportunities that were ignored because they were simply to painful to pursue.

A few weeks ago there was a post on carrier's excitement over the container concept. The convergence of software replacing dedicated hardware in the network is all part of the new IP revolution that can theoretically unleash the telco's from their old culture to one of serious product innovation.
brooks7 10/13/2015 | 10:45:17 PM
Re: Time to lay this argument to rest "The savings derived from SDN and NVF have always been secondary to the flexibility they brought on the operational side, be they existing KPI's or the relative ease of deploying new products and services. The ROI pitch began as a sales and marketing tool to get the board and executive level buy-in."

 

So, it is simpler to deploy things but costs the same?  No reduction in headcount?  If that is true, then there is no point.

seven

 
Mitch Wagner 10/13/2015 | 5:55:06 PM
Underpromise and overdeliver Underpromise and overdeliver is a good motto to live by. 

You just know that when Mr. Scott said he needed 16 hours to calibrate the warp drive, and Captain Kirk said they had 12 hours, Scotty knew that they could do it in 10. Then he did it in 11 hours and looked like a big damn hero. 
MordyK 10/13/2015 | 2:57:18 PM
Re: Time to lay this argument to rest The savings derived from SDN and NVF have always been secondary to the flexibility they brought on the operational side, be they existing KPI's or the relative ease of deploying new products and services. The ROI pitch began as a sales and marketing tool to get the board and executive level buy-in.
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