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Transport SDN

Verizon Deployment Will Trigger Bids for Sedona – Analyst

Being deployed by Verizon, one of the biggest and most influential network operators in the world, is a massive coup for network controller startup Sedona Systems and one that will likely lead to multiple acquisition offers that could tempt the company’s vackers to cash in, according to an experienced industry analyst.

Sterling Perrin, Principal Analyst -- Optical Networking and Transport at Heavy Reading , has been tracking Sedona Systems for some time and, while he knew the company had engaged with Verizon Communications Inc. (NYSE: VZ) and other Tier 1 operators during the past few years, he was excited to hear about the commercial deployment that was unveiled earlier this week. (See Verizon Turns to Sedona for Transport SDN Management & Automation Smarts.)

"Getting into the labs at Verizon is not impossible -- getting into the live network is really difficult," notes Perrin. "There is no bigger endorsement for a startup than to have a Tier 1 operator of Verizon's caliber using its technology commercially. It's an endorsement of the technology and the company and, in terms of an industry endorsement, it's even better that it's Verizon rather than, say, AT&T, which has been working with smaller, innovative companies and pushing the envelope for a while. Verizon, though, has been more cautious, taking the approach of ‘This is a telco, we're going to take our time.' So breaking into Verizon's network is a very big deal."

Adds Perrin: "What's going to be interesting is to see how Verizon uses Sedona's network controller, which is a good term to use for what Sedona has developed, I think. There are different levels of use. There are the initial stages of analytics and inventory management, then the next level of moving into multi-layer services such as bandwidth on-demand and ultimately multi-layer optimization -- it's a phased approach."

The Heavy Reading man adds that his research into such developments shows that network operators are very keen on benefiting from multi-layer automated IP/optical network optimization, and are very keen on the type of functionality that Sedona has developed. (See The Value of SDN-Based IP & Optical Integration.)

Which is why Perrin is puzzled that Sedona is pretty much unique in the industry. "What I still find strange is that no other company is able to do what Sedona can do -- it is the only company that is ever referenced in this context [a fully-functional network controller]. Other companies have some of the capabilities, particularly the vendors that have both optical and IP systems, such as Cisco, Huawei and Juniper. And Cyan's Blue Planet team was developing something but that got diverted by being acquired and owned by an equipment vendor [Ciena]," states Perrin. (See Is There Life on Ciena's Blue Planet? and Ciena Absorbs Cyan for New IP Onslaught.)

"But I don't think the operators want the equipment companies to be developing a multi-vendor network controller and performing this vital role and the OSS companies don't have the hardware experience to be able to develop something equal to Sedona, which has a rich heritage of hardware and software expertise in its ranks," adds Perrin.


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With Sedona seemingly unique in having developed multi-vendor, multi-layer, hybrid network management automation capabilities, and with Verizon under its belt, the Heavy Reading analyst believes Sedona will need to be acquired and have no shortage of willing suitors. "No small company ever supported a Tier 1 in the long term, so it will need to become part of a bigger organization. The most likely buyer will be one of the OSS or orchestration vendors or a systems integrator, but it shouldn't be acquired by an equipment vendor. The issue... is that if it gets acquired by an equipment vendor then it will lose its independence," which is critical to being perceived as a true and trusted multi-vendor controller developer, "so it's important that Sedona does not get acquired by a transport hardware system vendor," states the analyst.

As a private company Sedona doesn't share its financials, or much else related to its business position, but it did note on the occasion of its most recent funding round in August 2016 that it has raised almost $20 million from a range of investors including Intel Capital, NextStar and Bessemer Venture Partners. (See Sedona Systems Closes $13.6M Series B Funding Led by Intel Capital .)

— Ray Le Maistre, Editor-in-Chief, Light Reading

microcaptechinvestor 1/29/2018 | 12:52:36 PM
Re: Asleep at the wheel Thanks for the feedback. Good stuff.
Sterling Perrin 1/29/2018 | 9:06:20 AM
Re: Asleep at the wheel An interesting company. But it is an apples and oranges comparison with Sedona. Radcom is NFV and Sedona is SDN, controlling physical elements in the network. I see this as a different problem that Sedona has tackled and one that (as far as I have seen) has not been addressed by other vendors. 

 

Sterling
[email protected] 1/29/2018 | 3:19:13 AM
Re: Asleep at the wheel Glad you added the disclosure.

 

Article on Radcom is coming shortly - it is indeed a very interesting company with a highly disruptive approach to the industry.
microcaptechinvestor 1/26/2018 | 6:03:05 PM
Asleep at the wheel RADCOM now has claimed AT&T and Verizon as NFV customers (and is live in both networks!!), stealing both from incumbent Netscout. RADCOM has $250M market cap, VZ, AT&T, Globe Telecom as anchor customers and likely will sign Bell Canada and Telefonica soon. Bell announced major milestone in its Network 3.0 using Amdocs ONAP integration activities. RDCM sold to AT&T via AMDOCS in 2016, a 3 year $50M deal which has been expanded at least 4 times.

RDCM deeply embedded in ONAP and showcased successful OSM PoC with Telefonica at MWC last year.

Where are all the smart analysts??!

 

Disclosure: Long RDCM shares.
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