Insight: The Business of SDN

Posted by Mae Kowalke on Friday, June 12, 2015 with No comments

Network operators eyeing Software Defined Networking (SDN) and Network Functions Virtualization (NFV) deployments are basing their decision on one big question: will the investment in this technology be worth it?

One way to answer that question is looking at how SDN can help increase revenue, a factor that often ends up being more important (at least in the short term) than cost. Mitch Wagner, West Coast Bureau Chief at Light Reading, explained in a recent article that there's an inherent tension between product organizations (which are focused on reaching new customers through faster upgrade cycles and new features) and network organizations (which are concerned about things like reducing CapEx and OpEx, and making the network more efficient). 

When push comes to shove, product team priorities tend to get fast-tracked, Perrin said, meaning that revenue potential trumps cost. 

Another way to look at the question is to consider use cases expected to achieved desired ROI for SDN deployments. 

For example, a recent SDxCentral article looked at an emerging, real-world networking problem SDN could address: use NFV and SDN to secure hybrid cloud access for enterprises. Goals: secure the cloud when both public and private infrastructure is involved; offer a flexible, dynamic mechanism for user access; and secure communication between clouds and users.  

That type of security would be very appealing to enterprises, and therefore is an SDN application that could well be worth the investment by operators. 

Yet another perspective is to consider the case for pure play virtualization, and all the benefits it brings. Light Reading said that if you're going to virtualize, you should go all the way: be revolutionary. Why? Pure-play virtualization is consistent with ETSI NFV specifications (standard hardware, generic software VNFs), allows performance to scale with the power of the server, and puts EAD functionality in different locations including data center clouds. 

Those advantages take virtualization a step beyond the typical evolutionary motivations of lowering costs and creating innovative services by supporting Layer 2 and Layer 3 services at the network edge, Light Reading concluded. 

However you answer the question, one thing is for sure: interoperability of virtualized network equipment is key for the success of SDN and NFV. This is an area vendors need to improve, and is part of why Telefonica thinks SDN is still 3-5 years from maturity even though on the surface it's a simple answer to capabilities operators are asking for (like speeding up service delivery, or making bandwidth more flexible).  

What's SDN-related business aspect is top-of-mind for you?
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