NFV/SDN Reality Check: NFV TCO Deployment Analysis - Episode 40

Mobile carriers continue their march towards virtualization platforms using network functions virtualization and software-defined networking technologies. However, cost considerations remain a hurdle as these NFV and SDN deployments will be taxes with running concurrently with legacy platforms, thus accounting for surplus operational expense in the near term.

A number of companies have looked into breaking down the operational costs of NFV and SDN deployments using real-world scenarios. ACG Research earlier this year put out a report noting potential savings from moving towards SDN and NFV, with the firm noting gains from service innovations that SDN and NFV support.

“A major advantage of SDN/NFV is in its opex, which gives the operators the ability to rapidly provision new services,” explained Robert Haim, principal analyst at ACG Research. “Service roll-out is reduced by an order of magnitude of months to days. Moreover, with fast service roll out, a new service can be tested with a limited set of customers first, and then upon favorable feedback it can be introduced to the entire target market. This can save a lot of headache (and money) later if the service turns out to be not as well received as it was expected.”

A report from IHS predicted the migration to NFV “won’t happen any time soon,” citing “the bulk of LTE networks are brand new and, therefore, mobile operators are not ready to undertake migration that soon.”

On this week’s NFV/SDN Reality Check, we spoke with Angela Whiteford, VP of marketing and product management at Affirmed Networks, which put out its own report on the TCO topic that found adopting a virtualized evolved packet core solution can reduced capital expense by 69% and operating expense by 67% on average, and mobile operators were able to deploy a virtualized network much more quickly (in as little as six months) than they were with traditional networks (15 months on average) resulting in quicker time to market and time to revenue.

Affirmed Networks recently scored a deal with Canadian telecom provider Telus to deploy a cloud-based platform optimized for “Internet of Things” workloads. Specifically, Affirmed Networks will provide Telus with its Mobile Content Cloud solution, which works with 2G, 3G and LTE packet cores and includes policy and charging control, content and video optimization, Wi-Fi connectivity, service chaining, deep packet inspection, heuristics and real-time analytics.

On this week’s show, we also look at some of the top headlines across the NFV and SDN space:

--A new report from Strategy Analytics predicts big data analytics software will generate $81 billion in revenues by 2022, more than double the $36.2 billion expected to be generated globally this year.

In the report the firm explained that increased use of analytics by corporations – particularly in the healthcare, financial, industrial and manufacturing IoT vertical market segments, enables them to interpret the vast amounts of data they generate and respond to market dynamics in ways that benefit the corporation and its customers.

Among specific verticals, Strategy Analytics predicts the healthcare market will see a boost in software revenues form less than $8 billion this year to $17 billion by 2022; while the financial sector is predicted to see worldwide revenues increase from $6.9 billion this year to $13.8 billion by 2022.

As for the software itself, Strategy Analytics said much of it will be open source, which it claims is less expensive than proprietary software and can be run on commodity hardware that vendors expect will broaden its appeal to small- and mid-size business and mid-size enterprises.

--Cloud networking provider Aryaka recently said it has entered into a strategic partnership with KDDI subsidiary Telehouse Europe to become the preferred data center partner for Aryaka as it looks to expand using the Telehouse global footprint.

The companies said the deal will allow both to leverage complementary technologies, including Aryaka’s optimization technology that will be hosted in Telehouse and interconnected via KDDI’s global network. Aryaka noted the move was its first step in establishing a “long-term partnership” with Telehouse Europe as it looks to further penetrate the global enterprise WAN market.

Aryaka claims its software-defined, private WAN-as-a-service model provides enterprise-grade connectivity using patented TCP optimization, compression and application acceleration technology.

Telehouse added the hosting model will enable it to expand connectivity options for customers and boost its Telehouse Enhanced Connect optimization service offerings.

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