A new battleground is emerging in the service provider virtualization market -- the race to win NFV systems integration deals.
The company that has fired the first major salvo is HP Inc. (NYSE: HPQ) (HP), which has been chosen as the systems integrator (SI) for Telefónica SA (NYSE: TEF)'s Unica service provider virtualization strategy.
What's important for the rest of the industry -- operators, vendors and SIs alike -- is why Telefónica decided that it needed a single external company to perform that role.
A year ago, Telefónica CTO Enrique Blanco unveiled the operator's SDN and NFV strategy, fully expecting to see the first introduction of virtual network functions before the end of 2014. (See Telefónica Unveils Aggressive NFV Plans.)
But that didn't happen, because despite the clear and repeated requests from Blanco and his team for open, multivendor propositions from the vendor community, the Spanish giant received a welter of vendor-specific "we can do it all" propositions.
Blanco was so displeased, he shaved his beard off. (OK, so that's dramatic license on my part, but Blanco wasn't happy with the vendor feedback and the face hedge he sported a year ago is no more, so I'm putting two and two together to make five.)
The inability of the market to properly respond to Telefónica's needs led to a tweak in strategy and the need for a leading SI to help bring all the multivendor pieces together.
Why did HP get the nod? Well, it has been working with Telefónica for a while, it has knowledge of service provider IT as well as enterprise IT, it has expertise in virtualization and it has developed a program, OpenNFV, that incorporates a number of different elements (NFV Director, servers, storage, OSS tools) that can be used to manage a multivendor and constantly changing hybrid networking environment. (See HP's NFV Director Merges Physical, Virtual.)
Blanco insists that HP's role is not just to bring as much HP technology -- orchestration software, virtual network functions, IT platforms, and so on -- into the Unica project as it can: Its role is to be the enabler of an open, multivendor environment that will enable Telefónica to swap out and introduce functions and elements as needed without having to reconfigure its network.
That's a big task and the pressure is on HP -- Blanco and his team will demand that HP acts as an impartial SI and the rest of the industry will be watching to see if HP can pull this off. If it can, then others will want it to perform that same SI role for them -- to be the ultimate trusted NFV migration partner.
And that, as much as (if not more than) any hardware or software that can be sold, is where the big business will be in the service provider virtualization sector in the years to come.
Meanwhile, there is a growing group of companies that will be telling the world they can do this too and do it better than HP and of course that will include the major network equipment providers that have professional services and service provider IT capabilities, namely Alcatel-Lucent, Ericsson and Huawei.
Here's a list of companies (in alphabetical order and not including those NEPs) I expect to hear shouting about their NFV SI capabilities during 2015:
- IBM Corp. (NYSE: IBM)
- NEC Corp. (Tokyo: 6701)
- Tech Mahindra Ltd.
- Tieto Corp.
- Wipro Ltd. (NYSE: WIT)
There will be others too, of course -- if you can think of any more please suggest them using the message boards below.
What will be key to these companies being able to offer a credible NFV systems integration proposition to telcos is SI experience, telco experience, scalable professional services resources and an open, vendor-independent orchestration/management system with relevant IT system capabilities.
Let battle commence.
— Ray Le Maistre, , Editor-in-Chief, Light Reading