Insight: The Service Provider Drive Toward vCPE

Posted by Mae Kowalke on Tuesday, March 17, 2015 with No comments

Service provider margins and revenues are being threatened from all sides by cheap, dumb pipes, and customers’ shifting focus from networks to the applications they carry.

However, as enterprises increasingly migrate to public and private cloud resources, the connectivity to these hosted resources becomes their lifeline to the cloud. By the end of 2015, it's predicted that 70% of Fortune 500 enterprises will rely on hybrid cloud services.

Service providers are addressing these headwinds and opportunities by virtualizing as many customer premises appliances and functions as possible. The resulting cost savings and service agility makes vCPE a critical component in a competitive connectivity delivery model.

To understand how vCPE has evolved and how virtualization can now be applied to the demarcation point itself, service providers should be asking questions like:

  • How can NFV-based vCPE help us reduce both CapEx and OpEx?
  • How can we use NFV to enable customer self-installed services?
  • How can vCPE solutions integrate into our existing operational practices?
  • Why is the customer premise is a poor place to host most virtual network functions (VNFs)?
  • How can vCPE help us grow our revenue?

For insight into answering these questions, see:
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