Two years ago, when the concept of network functions virtualization (NFV) was first being discussed, service providers recognized its potential to replace costly, dedicated hardware with software and reduce network capital expenditures (CapEx). Now, as the industry begins to actually implement services based on a virtualized network, the focus is shifting from cost savings to business agility and the ability to bring services to market faster than ever before.
As John Donovan, senior executive vice president of AT&T architecture, technology and operations recently told The Wall Street Journal (subscription required) AT&T's increasing ability to adjust network equipment using software will mean that business customers can get a new service in just a couple of days, instead of two to three months. Other services, such as increasing bandwidth for customers, will take minutes as opposed to between 30 and 45 days.
NFV offers a new way to design, deploy and manage network services by decoupling network functions such as policy and charging rules function (PCRF), firewall or deep packet inspection (DPI) from proprietary hardware appliances, enabling them to run in a cloud software environment. It's a paradigm shift that will transform service providers' networks from a predefined set of physical infrastructure components to modular software building blocks. These components can be created, combined and shuffled at will, creating new network services, turning today's static networks into dynamic, elastic network clouds.
Until now, high network equipment cost and operational complexity have hampered service providers as they compete against more nimble over-the-top (OTT) competitors that have raised the bar for customer expectations when it comes to new services delivery speed.
The adoption of NFV will help service providers meet this challenge head-on. It will enable them to move from multiple proprietary devices to commercial off-the-shelf (COTS) servers, shift from physical network installation and configurations to remote, automated software-based processes, and provide automated elasticity and scaling. This in turn will bring a number of benefits in terms of business agility, such as faster time-to-market for new services, quicker revenue increases for existing services and removal of cost barriers to niche services.
The ability to turn today’s static networks into dynamic, elastic network clouds, while also cutting costs, is certainly attracting service providers' attention. According to an Infonetics forecast, the worldwide NFV market for the telecommunication and cloud service provider segments will grow from $930 million this year to over $8 billion by 2018, a staggering 72% compound annual growth rate.
The bottom line: as service providers begin their journey to transform their networks, proven NFV solutions from industry leaders will enable best-of-breed network services while avoiding vendor lock-in -- not to mention the additional benefits of agile and lean network operations. NFV is not just about reducing costs, it is also a gateway to accelerating new services that consumers don’t want to wait for.
— Shauli Rozen, Director of Product Strategy Network Cloud Service Orchestration, Amdocs, special to The New IP