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NFV: The Tricky Vendor Selection Phase

Telco_Editor

Guest Author: Jim Hodges, Senior Analyst, Heavy Reading

 

This is certainly an exciting time for network functions virtualization (NFV). After two years of massive mobilization of R&D and trial resources on both the communication service provider (CSP) and vendor fronts, the proverbial virtualized commercialized rubber is about to hit the road. And with that comes the inevitable vendor win and loss scenario. And this time, perhaps more than ever, there is a lot at stake since new NFV contracts and account break-ins may redefine the vendor landscape both for Tier 1 and Tier 2 vendors.

 

While it will take some time for the market forces to rank the players, our research since 2014 has shown that a number of attributes are vital. Not surprisingly, price is always a top three factor, as are PoC trial performance and product roadmap. 

 

However, once you get beyond those three, there are a number of factors -- some well understood and others still emerging -- that can also exert significant influence on the vendor selection process. Let’s consider these in more detail.

 

OSS integration

We have noted some angst amongst the carriers with whom we have discussed NFV implementation. While it tends to be a greater issue amongst Tier 1 operators, most are concerned to some degree that integrating new vendor virtualized solutions into existing OSS/BSS systems will be complex and expensive. Although this may not be a make or break decision point, it’s clearly important that new vendors focus on an ability to be integrated into these systems to neutralize the advantage the incumbent legacy vendor possesses.

 

Feature transparency and interworking

Feature transparency and interworking are also very important or critical attributes for most operators. Of course, this makes perfect sense given NFV will run in hybrid mode for a number of years and to have a consistent subscriber end-user experience there has to be feature transparency and interworking to ensure the cutover from legacy to virtualized systems is seamless.

 

Although this may have tended to play to the strengths of the incumbent vendor, I would say that this is less a factor than even 12 months ago, given vendors looking to break-in have done their due diligence and made the investment in feature development.

 

The impact of open source

The momentum behind open source continues to grow in large part due to initiatives such as OPNFV and other vendor and carrier-driven initiatives. While it will take more time to fully assess the impact open source will have, I believe it will ultimately become a critical vendor selection attribute. I adopted this view because I feel that many Tier 1 and even Tier 2 operators now see a window to make a radical transformation to use vendors interchangeably to afford them implementation flexibility and negotiating leverage they have not possessed in the past. While the term "best of breed" emerged in telecom circles more than 15 years ago with the deployment of softswitches, open source NFV has the potential to take this to the next level. In addition, open source also aligns with an open standards and interface approach that also enhances interworking.

 

The vendors with a strong strategy and proven commitment to open source coupled with a strong eco-system strategy have an excellent opportunity to win new accounts. When competing with a Tier 1 that resists open source in favor of a solutions-level virtualization play, which now is often associated with a vendor lock-in scenario, they will certainly have the upper hand. We have seen some early evidence of this already, but I expect this to be a strong focus of MWC2016 market collateral and announcements.

 

Cloud native services

Another important factor that is emerging in the vendor selection process pertaining to VNFs, specifically written to run in the cloud vs. simply porting software from existing platforms and converting them to VNFs. This also links back to the open source discussion, since the assumption is that in an open source world, new VNFs are written to specifically meet the cloud network performance metrics. Here again, we see vendors that are moving to deliver truly cloud-based VNFs as having an advantage over those that propose to simply port code. Another emerging consideration that CSPs are starting to push to vendors is to examine the advantages of running these specific cloud-based VNFs in virtualized containers that minimize overhead and are inherently more scalable.

 

How many VNF managers?

A final area that is emerging as an important vendor selection criteria is VNF manager strategy. There are two possibilities here: The first is to select a single generic VNF manager that can support vendor VNFs, or to use the VNF managers from the vendors that supply the VNFs. The second is a multi-vendor strategy. While there is little debate that the single generic VNF manager is the more desirable approach given it is simpler to manage and likely less costly, the consensus amongst the operators we have discussed this issue with is that for the first wave of commercial launches anticipated in 2016, it will likely be necessary to launch with the multi-vendor strategy. Still, we believe that by next year, we will see an even greater focus on vendors that can deliver generic VNF managers.

 

In summary, CSPs clearly expect a lot from their NFV virtualization vendors moving forward. They expect aggressive pricing, strong PoC performance, feature transparency, commitment to open source, viable orchestration strategies and progressive scalable software designs to fully exploit the cloud. This is a tall order for all vendors, but as in any major technology transition, some will exceed expectations and move from strength to strength, while others will underachieve.

 

 

 

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