21 May 2015
With NFV now moving out of its early experimental phase, what has the industry learned so far? Capacity asks what conclusions can be drawn from early NFV proofs of concepts.
In its embracing of network
functions virtualisation (NFV), the telecoms industry has
demonstrated an unprecedented sense of purpose and energy. Just
a little over two years ago there was no such thing as NFV,
just a few operators privately toying with the uncoupling of
the hardware and software elements of their network.
The starting gun was fired in
November 2012 when seven major carrier names selected standards
body ETSI to be the driving force behind the industry
specification Group for NFV. Since then, across the telecoms
sector and on every continent, carriers and service providers
have been busy testing every aspect of the physical network,
experimenting to see what can be run as a virtual function.
Vendors for their part are turning their back on decades of
hardware-led thinking and converting their existing product
portfolio to meet the demands of this new environment.
The impetus and relative unity
of vision that the industry has shown so far is nothing short
of stunning. But the journey is only just underway. As early
NFV and SDN trials and proofs of concept (PoCs) start to give
way to real deployments, this is a good time to take stock and
examine what has been learned so far.
The early NFV pace setters
– names like AT&T, NTT Com, Deutsche Telekom,
Telefónica – have long left tentative
experimentation behind. NTT Com has gone further than most in
bringing NFV-based commercial services to market. It is a year
since it boldly launched a cloud-based o er that enterprises
can activate themselves and pay for on a per-use basis. Built
on a platform developed by Virtela, a company it acquired only
in January 2014, the services are independent of any single
vendor’s vision and available right across the
carrier’s global footprint.
"We launched services in the
summer of 2014, in 50 locations worldwide covering all
continents," says Ivano Rondelli, director of network services
at NTT Com.
"Some were security-related
– rewalls, IDS, VPN services. Since then
I’d say we have faced internal issues, some
relating to the education of our salesforce. Things are picking
up slowly. We can now provide functions to customers that would
once have been in a box."
Initial difficulty has
been worth it, says Rondelli, with the complexities of the
pre-NFV model already giving way to something altogether easier
to manage. Even in these early phases, cost benefits are also
being noted: "In some areas we’ve calculated a
saving of 60% compared to the previous solution," he
"We’ve got faster
and more agile infrastructure. Customers can increase the
resources they need from on as they want, not wait for
He believes NTT Com has done 'a
pretty good job’ so far: "But we’re
still working on it. We’ll now expand NFV
capabilities so we are delivering all services that way."
He says the plan from the word
go was to be an NFV pioneer, not a follower. Rondelli claims
NTT Com was the first operator to launch NFV services on global
basis – whereas a number of operators have focussed
primarily on their home territory.
Sticking with a vendor neutral
platform, he says, has been key to its global focus, as the
operator has been able to take advantage of any software it
"It is also noteworthy that
AT&T made the decision to change absolutely everything,
while our strategy was to gain the bene ts without destroying
all we’ve done in the past," he adds.
Colt is another carrier which
embarked on NFV before NFV had a name, starting on the
virtualisation of its network back in 2011. The transition from
physical to virtual has been tricky at times, admits Nicolas
Fischbach, director of strategy, architecture and innovation
with Colt: "NFV requires significant transformation, and
carriers cannot realistically make it work with all legacy
networks, nor should they – a demarcation is
necessary," he says.
"Hybrid solutions enable new
NFV services to interoperate with existing environments,
allowing for a gradual introduction and transformation."
Some aspects of NFV are
mandatory requirements from day one, believes Fischbach, naming
in particular proper integration with the OSS stack and e
ective orchestration: "The virtualisationof network functions
needs to deliver the required network functionality at the
required performance, which has many network and compute
implications, otherwise large-scale NFV won’t
become reality," he concludes.
"If by virtualising existing
services carriers aren’t able to o er the same
level of performance and functionality, the NFV model
Colt has already learned a
great deal from its SDN and NFV deployments. In particular it
spotted early the challenges that lay ahead with OSS, service
assurance, performance and customer adoption.
"That is why early on, in
November 2012, we included a virtual CPE option within our
services portfolio. This allowed our customers to try out
virtual functions, and realise the benefits of having standard
network access within their premises rather than multiple
hardware elements in their buildings with limited flexibility,"
The Model T Ford of
Vendors naturally are exuberant
about the potential of NFV. The technology has the potential to
be the Model T Ford of networks, says Rob Morrison, director
product management, CSG International: "By decoupling from the
physical element of networking, the potential economies of
scale are transformed," he claims. "The part we are interested
in is virtual BSS. It’s a way to reduce both capex
and opex, once you no longer have to procure purpose-built BSS
hardware. You get accelerated time to market, better
flexibility, you can scale up and down at will, and you
eliminate over-provisioning. Capex can be reduced now, and opex
too will come down too once you have a uniformity of hardware.
It’s a bit like a budget airline that saves
maintenance costs by only buying one type of plane. Some
benefits are coming quicker than was expected."
Despite early successes, and
the efforts of both carriers and the vendors they have chosen
as partners, nobody is pretending that NFV today is the
finished article. The technology is still quite immature and
needs more work in order to achieve full operational readiness.
Solutions in the marketplace are no more than preliminary
releases, with limited functionality. NFV architectures and
deployments are complex, and the key building blocks to make
them work don’t overlay properly yet.
The total cost of ownership of
NFV versus traditional networking isn’t well
understood. Barry Hill is global head of NFV at software vendor
Oracle, which has been working with Vodafone Germany to
virtualise the latter’s IMS network for the
support of new VoLTE, VoWi and Message+ services. He calls
these painful early stages that the industry is experiencing
NFV 1.0: "The next challenge is about management and
orchestration," he believes. "How do you plug it all together,
when you used to do the job with wires and cables? is is the
way to greater e ciencies and more automation that in the
past. There’s not much by way of management and
orchestration in production yet though. When we get there we
can call that NFV 2.0, in my mind. It’s all about
taking out the need for human intervention and processes.
That’s when the network gets truly dynamic."
Hill’s vision of
NFV 2.0 involves Big Data and analytics, allowing the network
proactively to feed back in real time, driving orchestration
through a policy engine: "You’ll be able to see
what’s trending in the network in real-time," he
enthuses. "When a network is self-optimising,
that’s when you start to dramatically remove the
costs out of the operation of a network. Capacity can be
matched with demand. I don’t see NFV 1.0 creating
those sort of savings today, but as a carrier
you’ve got to be on board. The train has left the
There is a subsequent phase to
look forward to, says Hill, where business orchestration and
network orchestration are truly in harmony:
"That’s NFV 3.0 and it’s going to
result in a very different business model. Will this take time?
In some ways perhaps we’re closer than we think.
Carriers aren’t there yet – but they can
see where they’ve got to get to."
Alcatel-Lucent, which has been
acquired by Nokia in a deal worth €15.6 billion, has
traditionally been focussed on hardware but is now adapting
fast to embrace a virtualised world. It is already beyond the
PoC phase, having helped Middle East carrier Etisalat
revolutionise its access network, both in its home market and
in Sri Lanka, with its virtualised radio network
Phil Tilley, marketing director
of cloud solutions and strategy with Alcatel-Lucent, believes
that the industry’s early tests and trials were
about simply seeing what was practical and possible. He thinks
the next stage is for carriers is take the individual use cases
they have experimented with and see how interchangeable they
are: "We’ve seen operators like NTT and China
Mobile carry out PoCs with various different vendors, us and a
number of our competitors, and start to ask what they can mix
and match," he says. "After all, what is the real value of NFV
if you can’t mix and match across platforms?"
A decade in the
NFV is widely viewed as a 10
year transformation. If operators haven’t already
implemented the rst phase of NFV, they risk not having
initiated the organisational structural change required to make
NFV work in the long run.
"It’s as much
about organisational change as technical. The most competitive
service provider is the one who grasps this quickest," says
The development of new skills
is paramount, as well as carrying out retraining across the
business and ensuring that siloes are broken down: "Can the
networking guy pick up IT as quickly as the IT guy can
understand network protocols? The two are converging right now
and we’re starting to see teams working more
The experience of Telekom
Austria Group (TAG), another carrier in the NFV vanguard,
appears to conrm Tilley’s view. Sascha Zabransky,
its director of service and IT, says its trials have shown
there is room for improvement, especially in regards to
architecture and performance: "Firstly employees need to digest
the new technologies and understand how things work and
secondly, a company’s operational model has to
change, moving from a silo environment to horizontal layered
structure. is carries a number of challenges like the
internetworking of dierent organisational units in case of the
need to resolve failures."
But is NFV primarily about
internal streamlining, or providing an enhanced service to
"I see NFV as both about
increasing the efficiency of our network and its reliability,
and on the customer side it’s about letting our
customers benet from those efficiencies without buying the
network," says Mateo Ward, CEO of Neutrona Networks.
The Latin American carrier is
presently moving from NFV and SDN trial to actual deployment
with Juniper Networks as partner, launching later this year
with what will be the region’s most virtualised
"NFV lets us run two side by
side networks," he adds. "Without virtualising our routers we
would have had a much riskier migration from one physical
router to another."
Many of the early NFV
implementations have, like Neutrona’s, been
high-profile collaborations between big ticket vendors and
their carrier partners - CenturyLink and Cyan working on
NFV-enhanced services for enterprise customers, SK Telecom and
Samsung harnessing NFV for the support of a national IoT
initiative, Orange and Nokia Networks virtualising IMS, and so
But NFV is also an opportunity
for more specialised vendors to come to the party, often
working in complex groupings to which each brings a unique
perspective. A prominent example is Intel, Red Hat, Procera
Networks, Openet and Amartus which worked collaboratively with
ETSI NFV to present a proof of concept of a virtualised
real-time OSS/BSS at MWC in Barcelona.
Unlike most of the other
headline-grabbing NFV collaborations, this one did not involve
companies that were already partners or customers.
Cam Cullen, VP of global
marketing at Procera, draws an important distinction between
simple virtualisation and 'real NFV’: "Much
deployment at this stage is likely to be simple virtualisation
of existing functions, making them software-only," he says.
"The next phase is orchestration, and a good start has been
made. We’ve built our own VNF manager, to help
customers get to real NFV. We’re working with
other orchestration players in the market. As a small vendor,
we can’t force an operator to just adopt the one
orchestration system. Openness is a critical part of our
Only two years into NFV and
already it is clear that open source solutions have the power
to provide an industry-wide defacto implementation for NFV and
OpenDaylight, for example,
provides a compelling opportunity for mid-range carriers to
trial and implement NFV solutions. Tilley concedes that open
source is a great way to get innovation moving fast: "But I see
it as a bit like a kit car that you have to build yourself," he
"There’s a lot of
nuts and bolts you have to deal with. With CloudBand we bring
it all together for you and give you a production-grade
In these early phases, it is
hard to call any one model or philosophy a clear leader. Bengt
Nordstrom, founder and CEO of independent mobile strategic
consultancy Northstream, believes that it is all too early to
talk about NFV 'success stories’ or 'lessons
learned’: "NFV implementation is going to take
time," he warns. "It’ll be a gradual process,
since it directly relates to operators’ previous
infrastructure investments reaching their end of life.
Operators will introduce virtualisation as and when they
replace their existing legacy applications and systems."
If it’s too early
to declare NFV an outright success, the telecoms industry can
at least allow itself a little congratulation for what has been
achieved so far. Top to bottom transformation is never an easy
task, but the journey is well underway.
ARE SMALLER CARRIERS
GETTING LEFT BEHIND?
It is inescapable that most
of the NFV headlines so far are collaborations between Tier 1
carriers and their vendor partners. So is the industry
effectively excluding the lower tiers?
seeing so much NFV in the lower tiers," confirms Rob Morrison,
director product management, with CSG International. "The same
sort of benefits should be available to smaller carriers, like
simplification of business continuity and maintenance.
I’d expect that now some vendors have quite mature
offerings in NFV we’ll see more of it deployed by
these smaller carriers."
There is no doubt that at
its present stage of development, Tier 1 vendors are extremely
important to NFV. It’s these big names that have
the dollars to throw at the sort of R&D and lab trials that
are vital to the industry, and it is they who will be laying
down the key ground work and overcoming all the early
technology challenges. But they don’t have
exclusivity in innovation.
"I also think
there’s an important role for smaller vendors
because they have different business processes, and often work
in a more agile manner," believes Justin Paul, head of OSS
marketing at vendor Amdocs. "Tier 1 operators sometimes have a
more traditional approach to R&D and testing. Smaller
players can be very innovative and look at challenges in a
different way. We could see Tier 2s and Tier 3s offering some
very innovative NFV services more quickly through a more
Since smaller operators
have less complex networks, it is in theory easier for them to
experiment to discover what works and what does not, says Ravi
Palepu, head of telco solutions for IT consulting firm Virtusa:
"They need pragmatic approaches as every company’s
journey to virtualisation will be different," he adds.
Certain smaller operators
are already weighing with their own solutions, partnering in
some cases with smaller vendors. Tele-Post Greenland, for
example, is working in partnership with Dublin-based software
developer Openet on a move away from reliance on dedicated
hardware appliances. By leveraging standard IT virtualisation
technology it has been able to consolidate multiple equipment
types onto industry standard high volume servers, leading to
reduced opex and capex expenditure. Vip Mobile Serbia has
achieved something similar through using 'commercial off the
"NFV creates new
opportunities for smaller operators who must differentiate
themselves in a highly competitive market," believes Ben
Parker, chief technologist for with operational intelligence
platform developer Guavus. "NFV represents a way in which
service providers can create a more cost effective network and
in turn price services more competitively."
But other Tier 2 players
are pursuing a more cautious approach, and that’s
fine, argues Bengt Nordstrom, founder and CEO of mobile
consultancy Northstream: "Many mid-range operators have assumed
a 'wait and see’ approach - they’re
watching for the results from the Tier 1
operators’ trials and also waiting for more mature
NFV products to arrive on the market. It’s a safe
strategy, but it’s also important for midrange
operators to use this time to make the necessary preparations
for their future NFV implementations, such as developing the
business case and also putting in place a practical and
realistic roadmap for the changes that their networks will