NFV Strategies

Telcos Falling Further Behind OTTs on Virtualization

DUBLIN -- 2020 Vision Executive Summit -- Operators investing in new virtualized networks are already at risk of being left even further behind by web players introducing container technologies such as Kubernetes and Docker, according to Caroline Chappell, a principal analyst at Heavy Reading.

Speaking at Light Reading's 2020 Vision event in Dublin earlier today, Chappell said that companies like Google (Nasdaq: GOOG) and Amazon.com Inc. (Nasdaq: AMZN) are already moving the goalposts of the entire SDN and NFV game.

"Operators are trying to orchestrate first-generation VNFs [virtual network functions] with OpenStack while Internet players are waving goodbye to OpenStack through their rear-view mirrors," she told attendees during a presentation on the concept of the "composable" telco. "In fact, even Kubernetes is becoming old school for Google, which is moving on to something else."

Running applications inside software containers, which sit on top of the Linux operating system, represents an alternative to the use of virtual machines that include guest operating systems and more IT overhead. (See BT Pins NFV Future on Containerization and Containers a Critical Piece of Telecom's Future.)

According to research from Heavy Reading, some 97% of service providers are planning to deploy NFV technologies at some point over the next five years as they try to fend off growing competition from more agile web players.

As Chappell points out, however, the Internet players are not dealing with the same degree of end-to-end complexity facing telecom service providers when it comes to virtualizing their infrastructure. "If they are able to get that right and instantiate on that scale, it could be a unique opportunity for telcos," says Chappell. "The rest of the digital services life stuff will be a walk in the park."

While many operators are currently focused on what Chappell calls "first-generation" NFV, which involves the disaggregation of hardware and software, the next step will involve "decomposing" VNFs into microservices that can be assigned to virtual machines or containers.

The ultimate goal, however, is to have single-feature VNFs that can be developed into service chains. "You can decompose complex functions and then recombine them in novel and flexible ways," says Chappell.

CenturyLink Inc. (NYSE: CTL) is one example of a traditional operator that is basing its service development on these principles, citing its own software development team as the critical enabler of its hybrid platform.

For more NFV-related coverage and insights, check out our dedicated NFV content channel here on Light Reading.

Chappell believes there are three approaches to extreme automation, with most operators opting for a top-down approach that involves addressing challenges in the orchestration area.

Others reckon orchestration will eventually run out of steam and are instead trying to automate from the bottom up. "The idea is that you have components and give them all programmable brains so they can manage themselves," says Chappell. "

The third way is to have a programmable smart agent that controls the connections between various components. "Anything can talk to anything across this fabric," says Chappell. "You can impose information models and change them."

What seems clear is that operators are coming under pressure to adapt from changing customer needs. "An online retailer is probably going to need a different service model to talk to its customers' fridges than its back-office supply chain management system," says Chappell. "That will require extreme speed and automation and you won't be able to do that with the monolithic VNF beasts of today."

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

Buddy 12/10/2015 | 11:22:09 AM
True Live OTT Net Insight Here's a True Live OTT solution from Net Insight

mendyk 12/10/2015 | 11:01:27 AM
Re: N-OTT Netflix now has its own CDN. The other companies cited in this post also have significant IT and network resources. "OTT company" is not a useful label in this context. It's an oversimplification that might get by in a general-interest publication. Then again, we're still using the term "telco," which should have been put out to pasture years ago.
mhhf1ve 12/10/2015 | 10:49:30 AM
Re: N-OTT So what ARE some OTT companies (if not YouTube, Amazon)? Is Netflix an OTT company? Does an OTT company have to be solely dedicated to a single purpose? 

I get what you're saying, but just because Apple's a much larger company than just doing some OTT... doesn't mean it shouldn't be counted as a company that's in the OTT space.

It's not exactly the right analogy to say Apple :: OTT as ExxonMobile :: convenience store chain.... 
mendyk 12/10/2015 | 8:59:29 AM
Re: N-OTT By that definition, then, anybody who puts video on a server to be accessed over the Internet is an OTT company. Calling the Web giants OTT companies is a little like calling ExxonMobil a convenience-store chain. Technically accurate, but more than a little short of the mark. As suggested in this thread, this is more of an IT world vs. telecom world thing.
mhhf1ve 12/9/2015 | 6:54:51 PM
Telco CDNs getting better? I have to wonder what the status of telco CDNs are .. against Akamai and other CDN service providers. It would seem like a somewhat tricky way to avoid some net neutrality issues (or cross them head-on) if telcos were advancing their own CDN services.
mhhf1ve 12/9/2015 | 6:42:41 PM
Re: N-OTT > Amazon or Google as an OTT company. ??

> Over the Top (OTT) refers to video, television and other services provided over the internet rather than via a service provider's own dedicated, managed IPTV network.

Amazon has instant video streaming... Google has YouTube... Those services aren't the majority of Amazon or Google's revenues, but they're not peanuts.
jabailo 12/9/2015 | 6:42:30 PM
Re: The IT world virtualized almost 10 years ago The software stack guys are probably scrambling as hard as they can to get shops to build to their platform.  What else do they have?

The telcos can sit back and watch which way the wind blows.  

I would still expect constant devaluation of raw stacks, with tools maybe commanding some profit but ultimately the finished app will provide the value if useful to the customer.

This is the same trend in all content presentation.  Portals are doomed.  But Makers are increasing demand (Netflix has just announced it's increasing its self-generated tv programming).

brooks7 12/9/2015 | 11:11:03 AM
The IT world virtualized almost 10 years ago  

What part of you are really far behind is not clear?  The way that Telcos have traditionally done things is not fast and all the IT guys do is try stuff and keep doing it if it works.  

For example. I love the whole Virtualized CPE thing.  Even Baracuda sells virtualized versions of their products.  And they were the kings of stacking boxes.


mendyk 12/9/2015 | 10:47:24 AM
N-OTT I wouldn't characterize Amazon or Google as an OTT company.
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