Is the Asian market ready for NFV?

SDN and NFV have undoubtedly shifted the goal posts in terms of telecommunications networks and data centres. With services constantly changing, networks need to continuously evolve to meet the most stringent demand of both organisations and the end user. In Asia, migration to NFV is a conversation that has been gathering momentum in order to relive this increasing pressure.

 

But while there has been a buzz around the deployment of NFV in Asia for some time, evidence that this interest is being converted into commercial opportunity is yet to be seen. Speaking as part of Total Telecom’s first Virtualise That! Briefing, held in Singapore in association with VMware, APAC Head of ICT Research at Current Analysis Group Dustin Kehoe gave a presentation which explored whether the benefits of NFV have made it from the drawing board to real-world deployments.

 

According to Kehoe, the industry is currently suffering from two sets of problems when it comes to the common way of working – one is with networks and the other is with the cloud.

 

Considerable time has to be taken with networks to configure them manually and have a static workload that is unable to cope with the doubling of video traffic through networks every 12-15 months. Additionally, heuristic routing, while effective in problem solving, does not always provide the most optimal path to the solution. When the effects of each of these problems are combined, said Kehoe, flexibility and automation of tasks is dramatically impacted. 

 

In addition, Kehoe continued, hybrid cloud is now the norm but with it comes multiple management layers, such as configuration, incident, capacity, availability, SLA management, change management, service catalogue and the service desk. As with networks, this complex chain impacts the ability to automate tasks and orchestrate commands.

 

Consequently, we are now at something of a crossroads. 

 

“While we are responding to the issues encountered with networks and the cloud, these too have drawbacks that impact the efficiency and effectiveness of the service” said Kehoe. “Integrated APIs, for example, are vendor specific. Technically they are ‘open source’ but only in a fragmented way which means the vendor holds ransom over the way it is operated. This results in incredibly inconsistent implementations.”

 

Vendor interoperability, according to Kehoe, would be an ideal solution to this problem but, realistically, this is still years away as a feasible option. Until standards are introduced to ensure that services are consistent across the board, this scenario is currently based on the presumption that vendors will work alongside one another.

Another potential alternative identified by Kehoe is for operators to build their own IP. This, however, has limited scale and leads directly to competition between carriers and established vendors, and fragmented service.

 

Kehoe went on to outline some of Current Analysis’ own research, which has established that data centres and cloud services are the two areas in which organisations plan to implement SDN, with IT process automation – perhaps the most significant hurdle in traditional network and cloud use – cited as the main reason for seeking this change. 

 

This was consistent across small, medium and large companies, but the largest companies – those with over 10,000 employees – said that they would use the new system to implement a private cloud and to virtualise the data centre network. This difference is perhaps unsurprising, given that the challenges faced by an organisation of this size undeniably differ from a company with 1,000 employees.

 

In terms of Asia, Current Analysis has established that Australia, New Zealand, Japan and India are all relatively mature markets for SDN/NFV, but, significantly, the conversation is also gathering pace in the ASEAN markets, such as Malaysia, Indonesia and the Philippines. The next challenge is to get these countries past the proof of concept phase and into implementation.

 

To get over this hurdle where so many great ideas stagnate, said Kehoe, we must meet and exceed the expectations of those that will be using the new services. 

 

Reliability is absolutely key to this. Security monitoring, firewalls and secure VPN topped the list of important Virtual Network Functions (VNFs) in Current Analysis’ research. With Managed Service Providers already having success in managed security offerings, NFV services appear to be the obvious and natural extension.

 

Also vital to achieving this is speed of deployment – which Kehoe made sure to point out as he reminded gathered delegates that VMware is able to set up a virtualised telephone network in just ten minutes! The system’s ability to integrate with other software is also important, as this flexibility is essential with use cases being far broader than in traditional network function.

 

After speaking with 100 carriers, Current Analysis discovered that IP routing, network gateway and EPC are currently being trialled using NFV. Getting enterprises on board, however, is a challenge, said Kehoe.

 

He suggested that there are numerous barriers to commercial deployment that are slowing the progress – insufficient or unclear return on investment, the commitment of an entire organisation to such a significant change and the overall management of the change process. Kehoe added: “Until standardisation is achieved, enterprises will remain reluctant to commit to NFV due to the risk of ‘vendor lock-in’ on an open source system – they cannot just call for help if things go wrong.”

 

However, once tipping point is reached and NFV is adopted on a large scale, the benefits to be had are significant. Telcos know that they have a huge problem in the amount spent on CAPEX. PWC estimates that $65bn – or 20% of their overall income – is wasted on CAPEX and as much as 10% of that could be removed thanks to the migration to NFV. Furthermore, implementing NFV could significantly reduce OPEX. In order for NFV’s full potential to be realised, concluded Kehoe, the industry must just make sure that enterprises feel the benefits too.