Tag: Network Functions Virtualisation

The Telco Cloud Manifesto 2.0

Nearly two years on from our first Telco Cloud Manifesto published in March 2021, we are even more convinced that going through the pain of learning how to orchestrate and manage network workloads in a cloud-native environment is essential for telcos to successfully create new business models, such as Network-as-a-Service in support of edge compute applications.

Since the first Manifesto, hyperscalers have emerged as powerful partners and enablers for telcos’ technology transformation. But telcos that simply outsource to hyperscalers the delivery and management of their telco cloud, and of the multi-vendor, virtualised network functions that run on it, will never realise the true potential of telco cloudification. By contrast, evolving and maintaining an ability to orchestrate and manage multi-vendor, virtualised network functions end-to-end across distributed, multi-domain and multi-vendor infrastructure represents a vital control point that telcos should not surrender to the hyperscalers and vendors. Doing so could relegate telcos to a role as mere physical connectivity and infrastructure providers helping to deliver services developed, marketed and monetised by others.

In short, operators must take on the ‘workload’ of transforming into and acting as cloud-centric organisations before they shift their ‘workloads’ to the hyperscale cloud. In this updated Manifesto, we outline why, and what telcos at different stages of maturity should prioritise.

Two developments have taken place since the publication of our first manifesto that have changed the terms on which telcos are addressing network cloudification:

  • Hyperscale cloud providers have increasingly developed capabilities and commercial offers in the area of telco cloud. To telcos uncertain about the strategy and financial implications of the next phase of their investments, the hyperscalers appear to offer a shortcut to telco cloud: the possibility of avoiding doing all the hard yards of developing the private telco cloud, and of evolving the internal skills and processes for deploying and managing multi-vendor VNFs / CNFs over it. Instead, the hyperscalers offer the prospect of getting telco cloud and VNFs / CNFs on an ‘as-a-Service’ basis – fundamentally like any other cloud service.
  • In April 2021, DISH announced it would build its greenfield 5G network with AWS providing much of the virtual infrastructure layer and all of the physical cloud infrastructure. In June 2021, AT&T sold its private telco cloud platform to Microsoft Azure. In both instances, the telcos involved are now deploying mobile core network functions and, in DISH’s case, all of the software-based functions of its on a hyperscale cloud. These events appear superficially to set an example validating the idea of outsourcing telco cloud to the hyperscalers. After all, AT&T had previously been a champion of the DIY approach to telco cloud but now looked as though it had thrown in the towel and gone all in with outsourcing its cloud from Azure.

Two main questions arise from these developments, which we address in detail in this second Manifesto:

  • Should telcos embarked or embarking on a Pathway 2 strategy outsource their telco cloud infrastructure and procure their critical network functions – in whole or in part – from one or more hyperscalers, on an as-a-Service basis?
  • What is the broader significance of AT&T’s and DISH’s moves? Does it represent the logical culmination of telco cloudification and, if so, what are the technological and business-model characteristics of the ‘infrastructure-independent, cloud-native telco’, as we define this new Pathway 4? Finally, is this a model that all Pathway 3 players – and even all telcos per se – should ultimately seek to emulate?

In this second Manifesto, we also propose an updated version of our pathways describing telco network cloudification strategies for different sizes and types of telco to implement telco cloud. We now have four pathways (we had three in the original Manifesto), as illustrated in the figure below.

The four telco cloud deployment pathways in STL’s Telco Cloud Manifesto 2.0

Source: STL Partners, 2023

Existing subscribers can download the Manifesto at the top of this page. Everyone else, please go here.

If you wish to speak to us about our new Manifesto, please book a call.

Table of contents

  • Executive Summary
    • Recommendations
  • Pathway 1: No way back
    • Two constituencies at operators: Cloud sceptics and cloud advocates
  • Pathway 2: Hyperscalers – friend or foe?
    • Cloud-native network functions are a vital control point telcos must not relinquish
  • Pathway 3: Build own telco cloud competencies before deploying on public cloud
    • AT&T and DISH are important proof points but not applicable to the industry as a whole
    • But telcos will not realise the full benefits of telco cloud unless they, too, become software and cloud businesses
  • Pathway 4: The path to Network-as-a-Service
    • Pathway 4 networks will enable Network-as-a-Service
  • Conclusion: Mastery of cloud-native is key for telcos to create value in the Coordination Age

Related research

Our telco cloud research aligned to this topic includes:

 

Telco Cloud: Why it hasn’t delivered, and what must change for 5G

Related Webinar – 5G Telco Clouds: Where we are and where we are headed

This research report will be expanded upon on our upcoming webinar 5G Telco Clouds: Where we are and where we are headed. In this webinar we will argue that 5G will only pay if telcos find a way to make telco clouds work. We will look to address the following key questions:

  • Why have telcos struggled to realise the telco cloud promise?
  • What do telcos need to do to unlock the key benefits?
  • Why is now the time for telcos to try again?

Join us on April 8th 16:00 – 17:00 GMT by using this registration link.

Telco cloud: big promises, undelivered

A network running in the cloud

Back in the early 2010s, the idea that a telecoms operator could run its network in the cloud was earth-shattering. Telecoms networks were complicated and highly-bespoke, and therefore expensive to build, and operate. What if we could find a way to run networks on common, shared resources – like the cloud computing companies do with IT applications? This would be beneficial in a whole host of ways, mostly related to flexibility and efficiency. The industry was sold.

In 2012, ETSI started the ball rolling when it unveiled the Network Functions Virtualisation (NFV) whitepaper, which borrowed the IT world’s concept of server-virtualisation and gave it a networking spin. Network functions would cease to be tied to dedicated pieces of equipment, and instead would run inside “virtual machines” (VMs) hosted on generic computing equipment. In essence, network functions would become software apps, known as virtual network functions (VNFs).

Because the software (the VNF) is not tied to hardware, operators would have much more flexibility over how their network is deployed. As long as we figure out a suitable way to control and configure the apps, we should be able to scale deployments up and down to meet requirements at a given time. And as long as we have enough high-volume servers, switches and storage devices connected together, it’s as simple as spinning up a new instance of the VNF – much simpler than before, when we needed to procure and deploy dedicated pieces of equipment with hefty price tags attached.

An additional benefit of moving to a software model is that operators have a far greater degree of control than before over where network functions physically reside. NFV infrastructure can directly replace old-school networking equipment in the operator’s central offices and points of presence, but the software can in theory run anywhere – in the operator’s private centralised data centre, in a datacentre managed by someone else, or even in a public hyperscale cloud. With a bit of re-engineering, it would be possible to distribute resources throughout a network, perhaps placing traffic-intensive user functions in a hub closer to the user, so that less traffic needs to go back and forth to the central control point. The key is that operators are free to choose, and shift workloads around, dependent on what they need to achieve.

The telco cloud promise

Somewhere along the way, we began talking about the telco cloud. This is a term that means many things to many people. At its most basic level, it refers specifically to the data centre resources supporting a carrier-grade telecoms network: hardware and software infrastructure, with NFV as the underlying technology. But over time, the term has started to also be associated with cloud business practices – that is to say, the innovation-focussed business model of successful cloud computing companies

Figure 2: Telco cloud defined: New technology and new ways of working

Telco cloud: Virtualised & programmable infrastructure together with cloud business practices

Source: STL Partners

In this model, telco infrastructure becomes a flexible technology platform which can be leveraged to enable new ways of working across an operator’s business. Operations become easier to automate. Product development and testing becomes more straightforward – and can happen more quickly than before. With less need for high capital spend on equipment, there is more potential for shorter, success-based funding cycles which promote innovation.

Much has been written about the vast potential of such a telco cloud, by analysts and marketers alike. Indeed, STL Partners has been partial to the same. For this reason, we will avoid a thorough investigation here. Instead, we will use a simplified framework which covers the four major buckets of value which telco cloud is supposed to help us unlock:

Figure 3: The telco cloud promise: Major buckets of value to be unlocked

Four buckets of value from telco cloud: Openness; Flexibility, visibility & control; Performance at scale; Agile service introduction

Source: STL Partners

These four buckets cover the most commonly-cited expectations of telcos moving to the cloud. Swallowed within them all, to some extent, is a fifth expectation: cost savings, which have been promised as a side-effect. These expectations have their origin in what the analyst and vendor community has promised – and so, in theory, they should be realistic and achievable.

The less-exciting reality

At STL Partners, we track the progress of telco cloud primarily through our NFV Deployment Tracker, a comprehensive database of live deployments of telco cloud technologies (NFV, SDN and beyond) in telecoms networks across the planet. The emphasis is on live rather than those running in testbeds or as proofs of concept, since we believe this is a fairer reflection of how mature the industry really is in this regard.

What we find is that, after a slow start, telcos have really taken to telco cloud since 2017, where we have seen a surge in deployments:

Figure 4: Total live deployments of telco cloud technology, 2015-2019
Includes NFVi, VNF, SDN deployments running in live production networks, globally

Telco cloud deployments have risen substantially over the past few years

Source: STL Partners NFV Deployment Tracker

All of the major operator groups around the world are now running telco clouds, as well as a significant long tail of smaller players. As we have explained previously, the primary driving force in that surge has been the move to virtualise mobile core networks in response to data traffic growth, and in preparation for roll-out of 5G networks. To date, most of it is based on NFV: taking existing physical core network functions (components of the Evolved Packet Core or the IP Multimedia Subsystem, in most cases) and running them in virtual machines. No operator has completely decommissioned legacy network infrastructure, but in many cases these deployments are already very ambitious, supporting 50% or more of a mobile operator’s total network traffic.

Yet, despite a surge in deployments, operators we work with are increasingly frustrated in the results. The technology works, but we are a long way from unlocking the value promised in Figure 2. Solutions to date are far from open and vendor-neutral. The ability to monitor, optimise and modify systems is far from ubiquitous. Performance is acceptable, but nothing to write home about, and not yet proven at mass scale. Examples of truly innovative services built on telco cloud platforms are few and far between.

We are continually asked: will telco cloud really deliver? And what needs to change for that to happen?

The problem: flawed approaches to deployment

Learning from those on the front line

The STL Partners hypothesis is that telco cloud, in and of itself, is not the problem. From a theoretical standpoint, there is no reason that virtualised and programmable network and IT infrastructure cannot be a platform for delivering the telco cloud promise. Instead, we believe that the reason it has not yet delivered is linked to how the technology has been deployed, both in terms of the technical architecture, and how the telco has organised itself to operate it.

To test this hypothesis, we conducted primary research with fifteen telecoms operators at different stages in their telco cloud journey. We asked them about their deployments to date, how they have been delivered, the challenges encountered, how successful they have been, and how they see things unfolding in the future.

Our sample includes individuals leading telco cloud deployment at a range of mobile, fixed and converged network operators of all shapes and sizes, and in all regions of the world. Titles vary widely, but include Chief Technology Officers, Heads of Technology Exploration and Chief Network Architects. Our criteria were that individuals needed to be knee-deep in their organisation’s NFV deployments, not just from a strategic standpoint, but also close to the operational complexities of making it happen.

What we found is that most telco cloud deployments to date fall into two categories, driven by the operator’s starting point in making the decision to proceed:

Figure 5: Two starting points for deploying telco cloud

Function-first "we need to virtualise XYZ" vs platform-first "we want to build a cloud platform"

Source: STL Partners

The operators we spoke to were split between these two camps. What we found is that the starting points greatly affect how the technology is deployed. In the coming pages, we will explain both in more detail.

Table of contents

  • Executive Summary
  • Telco cloud: big promises, undelivered
    • A network running in the cloud
    • The telco cloud promise
    • The less-exciting reality
  • The problem: flawed approaches to deployment
    • Learning from those on the front line
    • A function-first approach to telco cloud
    • A platform-first approach to telco cloud
  • The solution: change, collaboration and integration
    • Multi-vendor telco cloud is preferred
    • The internal transformation problem
    • The need to foster collaboration and integration
    • Standards versus blueprints
    • Insufficient management and orchestration solutions
    • Vendor partnerships and pre-integration
  • Conclusions: A better telco cloud is possible, and 5G makes it an urgent priority

NFV Deployment Tracker: Global review and update

Welcome to The NFV Deployment Tracker!

This report is the fourth analytical report in the ‘NFV Deployment Tracker’ series and is intended as an accompaniment to the third update of the Tracker Excel spreadsheet (to the end of June 2018).

The update extends the coverage of the Tracker worldwide: adding a comprehensive set of data on live, commercial deployments of NFV and SDN in the African, Latin American and Middle East markets to the existing data set on Asia-Pacific, Europe and North America. In addition, the spreadsheet contains updated and expanded data on deployments in the latter regions.

The expansion of the Tracker’s coverage worldwide presents an opportunity to gain an overview of global SDN and NFV development and deployment trends, and to assess the prospects for the technologies, and the services based on them, going forward.

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Previous editions and other NFV / SDN research

Scope of information provided by the Tracker

The data in the NFV Deployment Tracker is sourced primarily from public-domain information such as telco and vendor press releases and reliable press reports regarding successfully completed deployments and the launch of live, commercial services based on virtualised network functions (VNFs) or SDN. We have also obtained some confidential information direct from operators, which we are unable to present in the detailed break-down of deployments by operator. However, this information has been added to an aggregated data set, which is also provided in the spreadsheet.

The data is therefore limited to verified deployments: production implementations of NFV and SDN powering live services, where we can be confident that the data on the VNFs and IT components involved is accurate and – as far as possible – up to date. We also include some information on deployments planned to be completed by the end of 2017 or by a date as yet unknown, where the information is in the public domain, and where the size and scope of the deployments merit their inclusion.

Contents:

  • Executive Summary
  • The volume and pace of SDN / NFV deployments continues to grow…
  • …but some fundamental challenges remain
  • The focus of deployments varies region by region
  • Operator trends
  • Vendor trends
  • Conclusion
  • Introduction
  • Welcome to the third update of the ‘NFV Deployment Tracker’
  • Scope, definitions and importance of the data
  • Analysis of the global data set
  • Constant growth – but SDN / NFV deployment is far from universal
  • Asia-Pacific ahead on number of deployments despite a slowdown in 2018
  • SD-WAN, SDN, core network functions and orchestration have driven the growth in 2018
  • Operator trends: Leading players rack up the deployments, leaving others lagging far behind
  • Vendor trends: a few major players dominate the scene – but telcos continue to look for alternatives
  • Conclusion 

Figures:

  • Figure 1: Growth in the number of SDN / NFV deployments per year, 2012 to June 2018
  • Figure 2: Breakdown of total deployments by region, 2012 to June 2018
  • Figure 3: Deployments by region, 2014 to 2018
  • Figure 4: Global deployments by higher-level category, 2014 to 2018
  • Figure 5: Deployments in Europe by leading category, 2014 to 2018
  • Figure 6: Asia-Pacific deployments by higher-level category, 2014 to 2018
  • Figure 7: Deployments in North America by leading categories, 2014 to 2018
  • Figure 8: Global deployments of leading VNFs and functional components, 2014 to 2018
  • Figure 9: Total deployments of leading VNFs and functional components, Middle East
  • Figure 10: Leading VNFs and functional components, Latin America
  • 1Figure 11: Leading operators by number of deployments, global
  • Figure 12:  Leading vendors by number of deployments, global
  • Figure 13: Leading vendors by deployment category 25

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The Open Source Telco: Taking Control of Destiny

Preface

This report examines the approaches to open source software – broadly, software for which the source code is freely available for use, subject to certain licensing conditions – of telecoms operators globally. Several factors have come together in recent years to make the role of open source software an important and dynamic area of debate for operators, including:

  • Technological Progress: Advances in core networking technologies, especially network functions virtualisation (NFV) and software-defined networking (SDN), are closely associated with open source software and initiatives, such as OPNFV and OpenDaylight. Many operators are actively participating in these initiatives, as well as trialling their software and, in some cases, moving them into production. This represents a fundamental shift away from the industry’s traditional, proprietary, vendor-procured model.
    • Why are we now seeing more open source activities around core communications technologies?
  • Financial Pressure: However, over-the-top (OTT) disintermediation, regulation and adverse macroeconomic conditions have led to reduced core communications revenues for operators in both developed and emerging markets alike. As a result, operators are exploring opportunities to move away from their core, infrastructure business, and compete in the more software-centric services layer.
    • How do the Internet players use open source software, and what are the lessons for operators?
  • The Need for Agility: In general, there is recognition within the telecoms industry that operators need to become more ‘agile’ if they are to succeed in the new, rapidly-changing ICT world, and greater use of open source software is seen by many as a key enabler of this transformation.
    • How can the use of open source software increase operator agility?

The answers to these questions, and more, are the topic of this report, which is sponsored by Dialogic and independently produced by STL Partners. The report draws on a series of 21 interviews conducted by STL Partners with senior technologists, strategists and product managers from telecoms operators globally.

Figure 1: Split of Interviewees by Business Area

Source: STL Partners

Introduction

Open source is less optional than it once was – even for Apple and Microsoft

From the audience’s point of view, the most important announcement at Apple’s Worldwide Developer Conference (WWDC) this year was not the new versions of iOS and OS X, or even its Spotify-challenging Apple Music service. Instead, it was the announcement that Apple’s highly popular programming language ‘Swift’ was to be made open source, where open source software is broadly defined as software for which the source code is freely available for use – subject to certain licensing conditions.

On one level, therefore, this represents a clever engagement strategy with developers. Open source software uptake has increased rapidly during the last 15 years, most famously embodied by the Linux operating system (OS), and with this developers have demonstrated a growing preference for open source tools and platforms. Since Apple has generally pushed developers towards proprietary development tools, and away from third-party ones (such as Adobe Flash), this is significant in itself.

An indication of open source’s growth can be found in OS market shares in consumer electronics devices. As Figure 2 shows below, Android (open source) had a 49% share of shipments in 2014; if we include the various other open source OS’s in ‘other’, this increases to more than 50%.

Figure 2: Share of consumer electronics shipments* by OS, 2014

Source: Gartner
* Includes smartphones, tablets, laptops and desktop PCs

However, one of the components being open sourced is Swift’s (proprietary) compiler – a program that translates written code into an executable program that a computer system understands. The implication of this is that, in theory, we could even see Swift applications running on non-Apple devices in the future. In other words, Apple believes the risk of Swift being used on Android is outweighed by the reward of engaging with the developer community through open source.

Whilst some technology companies, especially the likes of Facebook, Google and Netflix, are well known for their activities in open source, Apple is a company famous for its proprietary approach to both hardware and software. This, combined with similar activities by Microsoft (who open sourced its .NET framework in 2014), suggest that open source is now less optional than it once was.

Open source is both an old and a new concept for operators

At first glance, open source also appears to now be less optional for telecoms operators, who traditionally procure proprietary software (and hardware) from third-party vendors. Whilst many (but not all) operators have been using open source software for some time, such as Linux and various open source databases in the IT domain (e.g. MySQL), we have in the last 2-3 years seen a step-change in operator interest in open source across multiple domains. The following quote, taken directly from the interviews, summarises the situation nicely:

“Open source is both an old and a new project for many operators: old in the sense that we have been using Linux, FreeBSD, and others for a number of years; new in the sense that open source is moving out of the IT domain and towards new areas of the industry.” 

AT&T, for example, has been speaking widely about its ‘Domain 2.0’ programme. Domain 2.0 has the objectives to transform AT&T’s technical infrastructure to incorporate network functions virtualisation (NFV) and software-defined networking (SDN), to mandate a higher degree of interoperability, and to broaden the range of alternative suppliers available across its core business. By 2020, AT&T hopes to virtualise 75% of its network functions, and it sees open source as accounting for up to 50% of this. AT&T, like many other operators, is also a member of various recently-formed initiatives and foundations around NFV and SDN, such as OPNFV – Figure 3 lists some below.

Figure 3: OPNFV Platinum Members

Source: OPNFV website

However, based on publicly-available information, other operators might appear to have lesser ambitions in this space. As ever, the situation is more complex than it first appears: other operators do have significant ambitions in open source and, despite the headlines NFV and SDN draw, there are many other business areas in which open source is playing (or will play) an important role. Figure 4 below includes three quotes from the interviews which highlight this broad spectrum of opinion:

Figure 4: Different attitudes of operators to open source – selected interview quotes

Source: STL Partners interviews

Key Questions to be Addressed

We therefore have many questions which need to be addressed concerning operator attitudes to open source software, adoption (by area of business), and more:

  1. What is open source software, what are its major initiatives, and who uses it most widely today?
  2. What are the most important advantages and disadvantages of open source software? 
  3. To what extent are telecoms operators using open source software today? Why, and where?
  4. What are the key barriers to operator adoption of open source software?
  5. Prospects: How will this situation change?

These are now addressed in turn.

  • Preface
  • Executive Summary
  • Introduction
  • Open source is less optional than it once was – even for Apple and Microsoft
  • Open source is both an old and a new concept for operators
  • Key Questions to be Addressed
  • Understanding Open Source Software
  • The Theory: Freely available, licensed source code
  • The Industry: Dominated by key initiatives and contributors
  • Research Findings: Evaluating Open Source
  • Open source has both advantages and disadvantages
  • Debunking Myths: Open source’s performance and security
  • Where are telcos using open source today?
  • Transformation of telcos’ service portfolios is making open source more relevant than ever…
  • … and three key factors determine where operators are using open source software today
  • Open Source Adoption: Business Critical vs. Service Area
  • Barriers to Telco Adoption of Open Source
  • Two ‘external’ barriers by the industry’s nature
  • Three ‘internal’ barriers which can (and must) change
  • Prospects and Recommendations
  • Prospects: An open source evolution, not revolution
  • Open Source, Transformation, and Six Key Recommendations
  • About STL Partners and Telco 2.0
  • About Dialogic

 

  • Figure 1: Split of Interviewees by Business Area
  • Figure 2: Share of consumer electronics shipments* by OS, 2014
  • Figure 3: OPNFV Platinum Members
  • Figure 4: Different attitudes of operators to open source – selected interview quotes
  • Figure 5: The Open IT Ecosystem (incl. key industry bodies)
  • Figure 6: Three Forms of Governance in Open Source Software Projects
  • Figure 7: Three Classes of Open Source Software License
  • Figure 8: Web Server Share of Active Sites by Developer, 2000-2015
  • Figure 9: Leading software companies vs. Red Hat, market capitalisation, Oct. 2015
  • Figure 10: The Key Advantages and Disadvantages of Open Source Software
  • Figure 11: How Google Works – Failing Well
  • Figure 12: Performance gains from an open source activation (OSS) platform
  • Figure 13: Intel Hardware Performance, 2010-13
  • Figure 14: Open source is more likely to be found today in areas which are…
  • Figure 15: Framework mapping current telco uptake of open source software
  • Figure 16: Five key barriers to telco adoption of open source software
  • Figure 17: % of employees with ‘software’ in their LinkedIn job title, Oct. 2015
  • Figure 18: ‘Waterfall’ and ‘Agile’ Software Development Methodologies Compared
  • Figure 19: Four key cultural attributes for successful telco transformation

NFV: Great Promises, but How to Deliver?

Introduction

What’s the fuss about NFV?

Today, it seems that suddenly everything has become virtual: there are virtual machines, virtual LANs, virtual networks, virtual network interfaces, virtual switches, virtual routers and virtual functions. The two most recent and highly visible developments in Network Virtualisation are Software Defined Networking (SDN) and Network Functions Virtualisation (NFV). They are often used in the same breath, and are related but different.

Software Defined Networking has been around as a concept since 2008, has seen initial deployments in Data Centres as a Local Area Networking technology and according to early adopters such as Google, SDNs have helped to achieve better utilisation of data centre operations and of Data Centre Wide Area Networks. Urs Hoelzle of Google can be seen discussing Google’s deployment and findings here at the OpenNet summit in early 2012 and Google claim to be able to get 60% to 70% better utilisation out of their Data Centre WAN. Given the cost of deploying and maintaining service provider networks this could represent significant cost savings if service providers can replicate these results.

NFV – Network Functions Virtualisation – is just over two years old and yet it is already being deployed in service provider networks and has had a major impact on the networking vendor landscape. Globally the telecoms and datacomms equipment market is worth over $180bn and has been dominated by 5 vendors with around 50% of the market split between them.

Innovation and competition in the networking market has been lacking with very few major innovations in the last 12 years, the industry has focussed on capacity and speed rather than anything radically new, and start-ups that do come up with something interesting get quickly swallowed up by the established vendors. NFV has started to rock the steady ship by bringing the same technologies that revolutionised the IT computing markets, namely cloud computing, low cost off the shelf hardware, open source and virtualisation to the networking market.

Software Defined Networking (SDN)

Conventionally, networks have been built using devices that make autonomous decisions about how the network operates and how traffic flows. SDN offers new, more flexible and efficient ways to design, test, build and operate IP networks by separating the intelligence from the networking device and placing it in a single controller with a perspective of the entire network. Taking the ‘intelligence’ out of many individual components also means that it is possible to build and buy those components for less, thus reducing some costs in the network. Building on ‘Open’ standards should make it possible to select best in class vendors for different components in the network introducing innovation and competiveness.

SDN started out as a data centre technology aimed at making life easier for operators and designers to build and operate large scale data centre operations. However, it has moved into the Wide Area Network and as we shall see, it is already being deployed by telcos and service providers.

Network Functions Virtualisation (NFV)

Like SDN, NFV splits the control functions from the data forwarding functions, however while SDN does this for an entire network of things, NFV focusses specifically on network functions like routing, firewalls, load balancing, CPE etc. and looks to leverage developments in Common Off The Shelf (COTS) hardware such as generic server platforms utilising multi core CPUs.

The performance of a device like a router is critical to the overall performance of a network. Historically the only way to get this performance was to develop custom Integrated Circuits (ICs) such as Application Specific Integrated Circuits (ASICs) and build these into a device along with some intelligence to handle things like route acquisition, human interfaces and management. While off the shelf processors were good enough to handle the control plane of a device (route acquisition, human interface etc.), they typically did not have the ability to process data packets fast enough to build a viable device.

But things have moved on rapidly. Vendors like Intel have put specific focus on improving the data plane performance of COTS based devices and the performance of the devices has risen exponentially. Figure 1 clearly demonstrates that in just 3 years (2010 – 2013) a tenfold increase in packet processing or data plane performance has been achieved. Generally, CPU performance has been tracking Moore’s law which originally stated that the number of components in an integrated circuit would double very two years. If the number of components are related to performance, the same can be said about CPU performance. For example Intel will ship its latest processor family in the second half of 2015 which could have up to 72 individual CPU cores compared to the four or 6 used in 2010/2013.

Figure 1 – Intel Hardware performance

Source: ETSI & Telefonica

NFV was started by the telco industry to leverage the capability of COTS based devices to reduce the cost or networking equipment and more importantly to introduce innovation and more competition to the networking market.

Since its inception in 2012 and running as a special interest group within ETSI (European Telecommunications Standards Institute), NFV has proven to be a valuable initiative, not just from a cost perspective, but more importantly with what it means to telcos and service providers in being able to develop, test and launch new services quickly and efficiently.

ETSI set up a number of work streams to tackle the issues of performance, management & orchestration, proof of concept, reference architecture etc. and externally organisations like OPNFV (Open Platform for NFV) have brought together a number of vendors and interested parties.

Why do we need NFV? What we already have works!

NFV came into being to solve a number of problems. Dedicated appliances from the big networking vendors typically do one thing and do that thing very well, switching or routing packets, acting as a network firewall etc. But as each is dedicated to a particular task and has its own user interface, things can get a little complicated when there are hundreds of different devices to manage and staff to keep trained and updated. Devices also tend to be used for one specific application and reuse is sometimes difficult resulting in expensive obsolescence. By running network functions on a COTS based platform most of these issues go away resulting in:

  • Lower operating costs (some claim up to 80% less)
  • Faster time to market
  • Better integration between network functions
  • The ability to rapidly develop, test, deploy and iterate a new product
  • Lower risk associated with new product development
  • The ability to rapidly respond to market changes leading to greater agility
  • Less complex operations and better customer relations

And the real benefits are not just in the area of cost savings, they are all about time to market, being able to respond quickly to market demands and in essence becoming more agile.

The real benefits

If the real benefits of NFV are not just about cost savings and are about agility, how is this delivered? Agility comes from a number of different aspects, for example the ability to orchestrate a number of VNFs and the network to deliver a suite or chain of network functions for an individual user or application. This has been the focus of the ETSI Management and Orchestration (MANO) workstream.

MANO will be crucial to the long term success of NFV. MANO provides automation and provisioning and will interface with existing provisioning and billing platforms such as existing OSS/BSS. MANO will allow the use and reuse of VNFs, networking objects, chains of services and via external APIs allow applications to request and control the creation of specific services.

Figure 2 – Orchestration of Virtual Network Functions

Source: STL Partners

Figure 2 shows a hypothetical service chain created for a residential user accessing a network server. The service chain is made up of a number of VNFs that are used as required and then discarded when not needed as part of the service. For example the Broadband Remote Access Server becomes a VNF running on a common platform rather than a dedicated hardware appliance. As the users STB connects to the network, the authentication component checks that the user is valid and has a current account, but drops out of the chain once this function has been performed. The firewall is used for the duration of the connection and other components are used as required for example Deep Packet Inspection and load balancing. Equally as the user accesses other services such as media, Internet and voice services different VNFs can be brought into play such as SBC and Network Storage.

Sounds great, but is it real, is anyone doing anything useful?

The short answer is yes, there are live deployments of NFV in many service provider networks and NFV is having a real impact on costs and time to market detailed in this report. For example:

  • Vodafone Spain’s Lowi MVNO
  • Telefonica’s vCPE trial
  • AT&T Domain 2.0 (see pages 22 – 23 for more on these examples)

 

  • Executive Summary
  • Introduction
  • WTF – what’s the fuss about NFV?
  • Software Defined Networking (SDN)
  • Network Functions Virtualisation (NFV)
  • Why do we need NFV? What we already have works!
  • The real benefits
  • Sounds great, but is it real, is anyone doing anything useful?
  • The Industry Landscape of NFV
  • Where did NFV come from?
  • Any drawbacks?
  • Open Platform for NFV – OPNFV
  • Proprietary NFV platforms
  • NFV market size
  • SDN and NFV – what’s the difference?
  • Management and Orchestration (MANO)
  • What are the leading players doing?
  • NFV – Telco examples
  • NFV Vendors Overview
  • Analysis: the key challenges
  • Does it really work well enough?
  • Open Platforms vs. Walled Gardens
  • How to transition?
  • It’s not if, but when
  • Conclusions and recommendations
  • Appendices – NFV Reference architecture

 

  • Figure 1 – Intel Hardware performance
  • Figure 2 – Orchestration of Virtual Network Functions
  • Figure 3 – ETSI’s vision for Network Functions Virtualisation
  • Figure 4 – Typical Network device showing control and data planes
  • Figure 5 – Metaswitch SBC performance running on 8 x CPU Cores
  • Figure 6 – OPNFV Membership
  • Figure 7 – Intel OPNFV reference stack and platform
  • Figure 8 – Telecom equipment vendor market shares
  • Figure 9 – Autonomy Routing
  • Figure 10 – SDN Control of network topology
  • Figure 11 – ETSI reference architecture shown overlaid with functional layers
  • Figure 12 – Virtual switch conceptualised