How SDN and NFV are Enabling CSPs’ Growth

Scalability has become a regular concern, especially after the revolution with virtualization and the adoption of cloud technologies. Companies and CIOs are opting for an architecture which is not only flexible in terms of incorporating the rising/falling needs and payment options, but which is lower cost and which can be modified on the go. It is in this context that SDN (Software Defined Networking) and NFV (Network Functions Virtualization) not only offer to make high-capacity networks cheaper to build but provides reconfiguration while on the go. The two primary objectives of any network are to deliver and manage applications. The need is not just to set-up a network to deliver applications but manage it properly. The disruption of cloud technologies makes such management more complicated.

We mentioned SDN above, but what is it? SDN got its start on campus networks. As researchers were experimenting with new protocols, they became frustrated with the need to change software in network devices each time they wanted to try a new approach. They came up with the idea of making the behavior of the network devices programmable, and allowing them to be controlled by a central function. This led to formalization of the principle elements that define SDN today: the separation of control and forwarding functions; the centralization of control; and the ability to program the behavior of the network using well-defined interfaces.

What's next for SDN?

The next area of success for SDN was in cloud data centers. As the size and scope of data centers grew, IT managers looked for a better way to connect and control the growth of virtual machines. The principles of SDN, including emerging OpenFlow protocol, soon showed promise in improving how data centers could be controlled.

How NFV is Different?

In contrast to SDN, NFV was created by a consortium of communications service providers (CSPs). The original NFV white paper describes the problems that they are facing, along with their proposed solution: Network Operators' networks are populated with a large and increasing variety of proprietary hardware appliances. To launch a new network service often requires yet another variety and finding the space and power to accommodate these boxes is becoming increasingly difficult; compounded by the increasing costs of energy, capital investment challenges and the rarity of skills necessary to design, integrate and operate increasingly complex hardware-based appliances. Moreover, hardware-based appliances rapidly reach end of life, requiring much of the procure-design-integrate-deploy cycle to be repeated with little or no revenue benefit.

Network Functions Virtualisation aims to address these problems by leveraging standard IT virtualisation technology to consolidate many network equipment types onto industry standard high volume servers, switches and storage, which could be located in Datacentres, Network Nodes and in the end user premises. NFV is currently being advanced by a group within the international standards body ETSI. The group holds regularly scheduled meetings, the most recent of which was NFV#5 that just concluded in Malaga, Spain. This meeting marked the one-year anniversary of the NFV effort in ETSI.

People talk about the cloud as if it were a specific destination or set of destinations ("My music is in the cloud."). In fact, the answer to the question "Where is the cloud?" is "everywhere". The cloud is no longer limited to virtualized storage and services in a datacenter. It is now a metaphor and model for distributed applications built on low cost hardware using Virtual Machines (VMs). The document titled "Cloud Computing Synopsis and Recommendations" from the U.S. standards body, NIST enumerates the following essential cloud characteristics; on-demand self-service, broad network access, resource pooling, rapid elasticity and measured service. NFV is intended to realise the benefits of cloud computing in the telecom network, fueling the shift from dedicated appliances with fixed functions to a flexible and programmable network.

Why are service providers so interested in SDN and NFV?

There are a number of benefits, but CSPs are looking at them primarily to accelerate innovation and drive cost out of their business. There have been a number of sources that have recognized the future value of SDN in terms creating new services. One is the recent "SDN and NFV Strategies: Global Service Provider Survey" (Infonetics, July 8, 2013, reproduced with permission). On page 4 it describes one of the biggest factors driving operator interest in SDN: Service providers can quickly add,drop, and change the services and applications they offer by using SDN control software andNFV-virtualized network functions-on virtual machines (VMs) on standard physical serversrather than having to invest in new, specialized network hardware to deploy each new service.With these capabilities, they can cost-effectively test new services on a small group of customers before expanding for wider commercial availability, modify the service and give it another try, orsimply scrap it without too great an investment if it's not working out.

How SDN and NFV reduce costs

CSPs also expect to be able to achieve cost reductions in operations (OpEx) and in capital expenses (CapEx). The reductions in OpEx will largely be driven by automation. For example, automated commissioning of customer-located network devices reduces operational expenses by as much as 50%. Likewise, the move from dedicated appliances (such as routers, firewalls and security devices) will help the operators save on both OpEx (no need to send a truck to install each new device) as well as on CapEx (lower cost hardware, and charges for licensed functions are only incurred when the service is deployed). CapEx can also be reduced by 50% or more. While SDN and NFV are getting a fair amount of attention, it is for good reason: there is substance beyond the hype. In particular, SDN and NFV offer concrete ways for service providers to change their mode of operation and realise new benefits in terms of cost reduction and growing revenue, which leads research agencies like IDG to be predicting SDN to be a USD 2 billion industry by 2016.