NFV will top $15bn by 2020
The global network NFV market is predicted to be worth $15.5 billion by 2020 according to IHS Markit.
The global network functions virtualisation (NFV) market, which includes NFV hardware, software, and services
“Between 2015 and 2020, the service provider NFV market will grow at a robust compound annual growth rate (CAGR) of 42% – from $2,7-billion in 2015 to $15,5-billion in 2020,” says Michael Howard, senior research director: carrier networks at IHS Markit.
NFV represents the shift in the telecom industry from hardware to software focus, with operators and carriers investing more in software than in server, storage and switch hardware.
“NFV software will comprise 80% of the $15.5bn total in 2020 - or around $4 out of every $5 spent on NFV,” says Howard.
The report suggests that by 2020 the spend will be initially quite low, with only 11% of the $5bn in software – 16% will be from NFV replacement infrastructure to replace outdated purpose-built network hardware such as routers, deep packet inspection (DPI) products and firewalls.
The remaining spend will come from the replacement kit which will be needed to run NFV such as primarily virtual network functions (VNFs).
The report tracks what service providers spend on NFV hardware and software to deliver software-based services to customers via the consumer virtual customer premises equipment (vCPE) and enterprise vCPE use cases.
The vCPE use case opportunity, which includes ing spending to deploy consumer and enterprise services, is forecast to reach over $1.5 bn worldwide by 2020.