One of the salient characteristics of the digital revolution is the acceleration of change. Technologies that enabled the digital revolution over past decades experience ever-faster innovation cycles. And while it is a challenge to stay current with such accelerated changes, the advancements consistently deliver both operational and economic benefits.
Two technology trends that are transforming network management, particularly those that are widely-distributed and employ public, private, or hybrid cloud services, are software-defined networks (SDN) and network functions virtualization (NFV). Together, SDN and NFV technologies are making it easier to provision network resources, reduce CapEx and OpEx, and enable greater network flexibility.
Software-defined networks take a virtualization approach to network management, treating the management of network devices separately from the data plane controlling network traffic. By adopting this approach, enterprises gain greater flexibility and control in configuring network resources, establishing policies, and optimizing performance. The increasingly disaggregated nature of networks makes SDN a preferred approach to network management.
SDN is no longer the next big thing on the networking horizon but a reality and inevitability for enterprises and service providers. SDN is emerging out of the early adopter and into the early mainstream stage of its development, and will play a role in shaping the next generation of networks for use-cases such as SD-WAN, micro-segmentation, and IoT.
There are three key catalysts in the industry driving the need for network change from the transitional method of managing networks and move toward an SDN approach, mobility, cloud, and IoT. There are also three main ways to approach SDN, Open SDN, SDN by overlays, and SDN by APIs – the latter being a preferred method used by traditional networking hardware companies.
SDN implementation via APIs refers to southbound APIs that configure and program the control plane active on the device. There are a number of legacy network device APIs in use that offer different degrees of control (SNMP, CLO, TL1, RADIUS, TR-069, and the like) and a number of newer ones (NETCONF/YANG, REST, XMPP, BGP-LS, and so on) that offer different degrees of control over the network devices, data plane, topology, among others, each having different advantages and disadvantages. There is one key difference between them and the Open SDN approach that needs to be highlighted. OpenFlow is used to directly control the data plane, not just the configuration of the devices and the control plane.
Obviously, no company is going to replace all of their hardware overnight, as it would require considerable expense, implementation and architecture challenges that until resolved could impact company operations. In addition, there would be plenty of non-technical issues, like employees knowing device X and networkOSY like the palm of their hands and not looking forward to the time it might take to learn new technology and processes.
When a company decides to transform to as SDN infrastructure, they may not get support from their existing network hardware vendor, who may have been enjoying hefty margins in network hardware sales and is not thrilled to push a technology that will make their expensive boxes replaceable for cheap vendor-agnostic white boxes.
SDN may be high on the enterprise’s list of priorities, but NFV is also poised to remake IT connectivity, even though it is primarily seen as a carrier solution.
Exactly how this will play out, however, is the subject of some dispute. On the one hand, NFV is supposed to provide the same flexibility in infrastructure design and deployment that white box commodity hardware is bringing. On the other, vested interests in the networking industry appear to be okay with some level of abstraction, but not a fully vendor-neutral framework.
As service providers dive deeper into SDN/NFV, they realize existing operational and business support systems (OSS/BSS) lack the capability and flexibility to fully achieve agile service delivery. The evolution to SDN/NFV requires an agile service-fulfillment solution that supports the service provider’s journey from their current architecture to a hybrid of traditional and SDN/NFV domains, and ultimately to a fully virtualized environment. Companies need guidance on OSS/BSS architectural considerations to simplify and accelerate service delivery.
Mobile and fixed-line CSPs are investing in NFV/SDN to reduce CapEx and OpEx, and to enable new kinds of revenue-producing services. SNS Research estimates that CSP NFV/SDN investments will rise to nearly USD 22 billion by the end of 2020. But the business case of NFV/SDN goes beyond top- and bottom-line improvements. CSP business survival depends on quick migration to a new business and cost model, capable of delivering new kinds of added-value, on-demand services at web scale. In short, CSPs must emulate cloud-service provider models to be able to compete against them and other emerging market entrants.
Despite the compelling business case and investments in NFV/SDN to-date, CSPs have been slow to reap expected benefits. Often the trouble is in moving from proof-of-concept and lab evaluations into field trials and commercial deployments. A major obstacle to the successful deployment of dynamic, software-controlled network functions has been operational – specifically, legacy domain – and node-based silos of IT and network management that lack the service-oriented processes, skillsets, and organizational structures and metrics to successfully deploy and operate NFV/SDN.
The introduction of 5G is also a key motivation for telcos to be interested in network virtualisation. Indeed, 5G networks expect to support different types of services driven by the development of IoT and the increased demand of connectivity from different vertical industries. For reasons of efficiency and flexibility, 5G will need network slicing, where each slice will have the capability to address specific services requirements in terms of latency, capacity, and energy consumption. As a consequence, SDN and NFV will have a key role in network evolution as enablers of network slice creation and orchestration. As key building blocks for 5G, they will be able to allocate resources for different use-cases and enable the network to scale dynamically.
SDN and NFV technologies are complementary. SDN and NFV technologies are complementary, with NFV providing many of the actual services managed in a software-defined network. SDN focuses on the control plane while NFV focuses on optimizing the actual network services managing data flows.
The genesis of NFV was the need for faster deployment of network services in response to business growth. Physical hardware network devices can have the inherent drawbacks of protracted procurement cycles and physical installation, the latter being problematic when installing devices in many remote locations.
With NFV physical networking, appliances such as routers, firewalls, and VPN terminators are replaced by virtual devices that run on commodity hardware. In many ways, this mirrors the as-a-service approach characteristic of cloud services. These virtual devices can be made available on-demand from communication, network, or data center providers.
Standardization. The disruptive forces of SDN and the seemingly limitless potential of a virtualized network continue to be stymied by a fundamental lack of industry standardization. The goal, ultimately, is the opportunity to ditch the physical facility altogether. But the current reality of SDN, NFV, and virtualization is stuck in the appliance swap-out phase, or Virtualization 1.0. The time for standardization is now.
SDN is itself a subset of OpenFlow, the open-source standard upon which the concept was founded. But others are competing for supremacy. Network equipment manufacturers (NEMs) are trying to maintain a hold on their appliances market share with offerings like Cisco’s application-centric infrastructure, a data center and cloud solution that integrates the management of the virtual and physical IT network. It provides a platform for running the network upon which new applications can be built, provisioned and rolled out quickly – essentially, a proprietary version of SDN.
Large NEMs are faced with a reinvention of their own. As SDN and NFV liberate networks from clunky hardware, so does it liberate profits from gear giants like Ericsson, Huawei, and Cisco. NEMs do not want to lose their market share. They would like to see their version of virtualization take hold.
Unlike SDN, NFV standards are emerging more quickly and clearly through the ETSI Industry Specification Group for NFV that includes operators including AT&T, BT, Deutsche Telekom, Orange, Telecom Italia, Telefónica, and Verizon. The group also includes 52 other network operators, equipment vendors, IT vendors, and technology providers. NFV can work with, or complement, SDN functions; but the two do not necessarily go hand in hand. With NFV, the goal is to replace rigid, dedicated use appliances with eminently more flexible and scalable software.
The market will ultimately choose which of the competing standards will dominate the landscape, but the Open Networking Foundation’s Executive Director, Dan Pitt, makes a pretty convincing case for the inevitable success of OpenFlow, the original, and most fundamental, architecture upon which virtualized networking was built.
First, open standards running on Linux or Windows servers eliminate the dreaded fear of vendor lock-in. It is hard to imagine service providers, just freed from the constraints of the physical hardware, to enter into a similar arrangement with proprietary networking software. Open source also allows smaller, lighter, more innovative developers to focus on the business of creating new services rather than keeping the lights on.
SDN. The SDN market size is set to exceed USD 100 billion by 2025 to register a CAGR of over 40 percent between 2018 and 2025 as predicted by Global Market Insights, Inc.
The exponential surge in the generation of digital data has given rise to data congestion issues in various heterogeneous network environments. The SDN controller reduces the complexity of managing such networks by improving service delivery and reducing operating expenses. It redirects packet-based network requirements, modifies the traffic flows, and notifies network operators regarding congested links. Managed service providers in SDN market are predicted to grow at a CAGR of over 45 percent over the forecast timeframe. The rising budgetary constraints are encouraging companies to adopt managed services. The managed services reduce capital expenditure by 30 to 40 percent and increase operational efficiency by approximately 50 to 60 percent.
Cloud service providers held over 35 percent share in the SDN market. They are leveraging on the abilities of SDN to build a cloud inter-network for augmenting the flexibility and scalability of cloud-based platforms.
The manufacturing industry is expected to register a growth rate of over 40 percent during the projected timespan. The increasing proliferation of advanced technologies, such as the Internet of Things (IoT) and Machine-to-Machine (M2M), is driving the use of SDN solutions in the sector. The technology reduces the hardware expenditure by eliminating the requirements for manual configuration. It also enables a central point of control that allows operators to control the whole network as a single unit, enhancing network visibility and streamlining network management.
The Asia-Pacific SDN market is anticipated to grow at a CAGR of over 40 percent during 2018-2025. This is attributed to the increasing adoption of cloud computing and network-virtualization technologies. The high investments by telecom service providers will enhance the connectivity infrastructure in the region, augmenting the use of SDN solutions. For instance, China’s telecom companies, such as China Mobile, China Unicom, and China Telecom, are set to invest over USD 180 billion by 2023 in the development of 5G infrastructure, which is expected to supplement market growth. Furthermore, increasing penetration of smartphones and the internet is also adding to market growth.
The key vendors operating in the market are HP, AT&T, IBM, Intel, Juniper, Huawei, Pics8, Big Switch Network Plexxi, Extreme Networks, Arista Network, Pluribus, Pics8, NEC Corporation, and Cisco. The major players are strategically acquiring various SDN-based start-ups to enhance product capabilities and gain technical expertise.
NFV. The global NFV market is projected to surpass USD 70 billion by 2024, to register a CAGR of over 42 percent between 2018 and 2024, as predicted by Global Market Insights, Inc. This robust growth can be attributed to the growing demand for server virtualization and data center consolidation. Data center consolidation involves reforming old data center facilities, architecture, network transformation, optimization, resource integration, and system migration to make them more energy efficient, agile, reliable, and economical to offer sustainable development.
In enterprise IT environment, the server, storage infrastructure, and associated complexity issues cause most of the enterprises to spend over 70 percent of their resources and budget on maintenance and operations while leaving less than 30 percent resources for innovation. Through infrastructure convergence using virtualization technologies, such as NFV, enterprise IT departments can shift their focus from maintenance and operations to innovation.
Another important factor expected to drive the adoption of NFV solutions is the massive investment by telecom service providers for the commercialization of 5G. Some of the typical issues in complex carrier networks are a huge diversity in proprietary nodes and hardware appliances and the requirement of additional proprietary hardware for launching new services.
Asia-Pacific NFV market is expected to register the fastest growth between 2018 and 2024 due to the increasing demand for cloud-based computing, storage, and networking solutions from the rapidly emerging technology companies in the region. With major investments in NFV technology from telecom companies, such as ZTE and Huawei in China, the innovation in NFV solutions and services is expected to accelerate rapidly over the forecast timeline. Under China’s Internet Plus initiative to modernize and transform traditional industries to join the modern economy, the telecom service providers in the country are rapidly embracing NFV technology to benefit from its flexibility, speed, and cost-effectiveness.
Some of the key players operating in the NFV market are Huawei, Ericsson, Cisco, Juniper, VMware, Nokia, F5 Networks, HP, AT&T, Citrix, NFWare, Riverbed, 6Wind, Broadcom, Verizon, Pluribus, Arista, Amdocs, and IBM.
Indian market. In the cut-throat Indian scenario, the operators need to reduce their new CapEx investments and OpEx for existing infrastructure. Operators are also forced to monetize their data services to ensure sustainability by increasing ARPU.
As India plans to roll out state-of-the-art 5G telecom services in the next four years, operators will be pushed to adopt new network architecture (centralized control with dynamic flexibility and programmability), and virtualization (hardware-free cost-effective) will be a critical aspect of networks. The monetization opportunities linked will ensure a steady flow of revenue and sustainability for the service providers. The CSPs cannot afford not to react as they face competition from high-margin network OEMs, MVNOs (mobile virtual network operator) along with Amazon, Google, and Facebook, who have significantly increased their R&D investment in SDN and NFV.
Apart from leveraging SDN and NFV capabilities, carriers are integrating cognitive technologies such as artificial intelligence (AI) and machine learning (ML) to evolve to a zero-touch network that can automate performance management and maintenance functions without manual intervention to prevent network faults and reduce expenses.
The adoption rate in India is slow because technology standardization and maturity levels of implementation are still evolving. Many large telcos in India have not taken up a significant leap into SDN due to lack of confidence in the maturity level of SDN solutions. In such cases, system integrators play an essential role in an organization’s multi-phased transformation journey through multi-vendor system integration and certification and benchmarking of vendor-supplied solutions and managed services for end-to-end service fulfillment with assurance. The Indian operators would be well advised to accelerate SDN/NFV deployment plans to cater to increasing service needs of the Indian subscribers.
Multiple viable options can exist – depending on the current state of operations in both IT and network organizations. It is only through a careful, independent assessment of the current state of each respective organization can an appropriate way forward be developed. It is critical to balance structural changes and accountability with process efficiency. An appropriate recommendation for this balance can be developed only after an independent review of the culture and environment present within the organization.
There is no right answer in planning and implementing an operations model for this technology, all decisions and options involve trade-offs. Choices do not have to be permanent. It is ok to design a roadmap that is an evolution rather than a flash cut or radical answer, which may further harden divisions between network and IT organizations.