I blogged recently about the three categories of operators, categories divided by the operators’ thinking on the path to transformation and the role of things like SDN and NFV. It’s only fair to do the same thing now with the network vendors, who also happen to divide into three categories. Where the operators divide based on how they’ll successfully pursue transformation, the vendors divide based on where they’re placing their own technology bets, which interestingly isn’t necessarily where their buyers seem to be looking to invest.
Vendors, of course, are about products where operators are about ROI. For at least two decades, vendors have supported network technology revolutions to the extent that they aided in engagement, that they opened doors for dialog. The current technology revolutions are SDN and NFV, and so it’s easiest to classify vendors by looking at how these technologies play in their strategies.
The first vendor grouping is the formalists. This group of vendors assumed, and largely still assumes, that SDN and NFV standards and related PoC and trial activity will drive transformation and generate sales for them. It’s fair to say that most vendors started in this group, but at this point probably two-thirds have moved out of it because of a lack of sales success.
The problem with sales for this group is primarily due to the limited scope of the formal standards activity. That’s particularly true for NFV, which at first limited its own activity scope so much that an end-to-end service was more out of scope than in. The lack of scope not only makes trial and PoC work more difficult to align with deployment reality, it forecloses the standards’ support of a complete business case. Both the SDN (ONF and ODL) and NFV groups have been working to broaden their scope, but obviously recent efforts here couldn’t pay back quickly. Thus, 2017 isn’t going to be much better for this group.
Pace of progress is the second issue this group has faced. Both SDN and NFV are around five years old, and we’re still struggling to get SDN out of the data center and NFV out of a little box on the premises that we call “virtual CPE”. Vendors have quarterly sales quotas, and the big SDN/NFV formalist companies’ sales force started complaining to me about how operators were slow on the uptake in 2014, when virtually nothing had been proven about either technology.
Even those who aren’t motivated to change groups by the sales issues will likely be motivated by the shift in SDN/NFV momentum toward open-source projects, away from standards bodies. I believe that Open Daylight is doing more for SDN than the ONF, and that the various open-source projects related to NFV and now jockeying for positioning are going to eclipse the work of the NFV ISG. Open source tends to undermine vendor differentiation, which means that early deals don’t have the profit margin needed to justify all the legwork needed to close them.
The second grouping is the shape-shifters. The members of this group are formalist expats, driven out by a lack of sales success and the recent negative publicity on SDN/NFV adoption, but not committed to any specific alternative course. The view of this group seems to be that the market has stalled temporarily, but that everything will come out right in the end. In the meantime, keep your name in the press.
Some good concepts are being opened up by this group, despite the somewhat cynical foundation for their behavior. CORD (Central Office Rearchitected as a Data center) is an idea I’ve blogged favorably about in the past. It frames what a CO should look like after transformation rather than talking about narrow-scope, multiple-standards, initiatives that might get us to that end-game. That’s helpful because operators don’t like to stumble into a CO framework; they’d rather plan one. It’s unhelpful because it still begs the question of why we’re taking the journey to CORD to begin with.
Perhaps the best outcome we’ve had so far that relates to the migration between formalism and shape-shifting is the attention that AT&T’s ECOMP is getting. ECOMP isn’t a vendor strategy; it’s in fact a kind of ant-vendor strategy in that it came out of AT&T’s Domain 2.0 program aimed at containing vendor influence and preventing lock-in. ECOMP is the glue that binds the D2 domains, and as such it’s a natural mediator of technology differences and evolution. It’s ECOMP that seems to form the centerpiece of the final vendor grouping.
This group still faces two specific challenges. One is a way to generate provable benefits in the near term, benefits needed to justify the risk that new technology adoption necessarily brings. The other is a credible pathway to a new vision of infrastructure. We have to jump-start SDN/NFV, and then we have to get it to a new, good, place. Operators tell me that even this second group of vendors is still relying on “everybody’s doing it” to justify their solutions. Everybody, clearly, is not.
Which is the specialists. From the first there were vendors who didn’t see themselves as providing a full-spectrum SDN/NFV or transformation solution. They just wanted to be a part of the game, and make money on it. In the NFV space, we have a large community of VNF provider hoping for somebody to manage and deploy them, and a bunch of NFV Infrastructure (NFVI) players hoping to be hosted on. These vendors were all at risk should anyone field a total NFV solution, because such a vendor wouldn’t be likely to make a place for them. Now, with it less likely every day that any vendor will promote a full-spectrum transformation strategy, and with increased operator interest in the vendor-neutral ECOMP model, the specialization approach doesn’t look as risky.
To say that there won’t be vendors, or vendor domination, of a “neutral” ECOMP may miss the mark, though. In fact, ECOMP opens the door for another vendor community altogether, one that’s been largely on the sidelines so far—the OSS/BSS providers. Of the seven operators I’m aware of (beyond AT&T and those announced already), five are looking at ECOMP in no small part because of an OSS/BSS vendor’s recommendations. One such vendor, in fact—Amdocs.
A perfect transformation storm would start with service lifecycle automation that reduces “process opex” by at least a third for relatively little investment. That same automation could then facilitate the introduction of SDN and NFV where it made sense, and also prepare operators for new revenue models, including hosted-experience OTT models. It would base network transformation on overlay models like SD-WAN, something to immunize services and customers from technology shifts at the infrastructure level and to separate service and resource lifecycle management convincingly to let the former evolve toward portals and software automation and the latter toward sustaining planned levels of capacity and performance.
All of this could be done below the OSS/BSS, and could in fact have been a part of NFV all along—the critical orchestration requirement (MANO) was part of NFV from almost Day One. The issue of scope, the decision to initially exclude legacy elements and OSS/BSS, opened the door for those who wanted to solve the problems elsewhere, or who had to—like AT&T.
What may strike you about the difference between the operator and vendor categories is that operators had two groupings that were on the right track, and the truth is that vendors don’t have any. All of these three vendor groups are depending on some future shift that the vendors themselves seem unwilling or unable to drive. It’s almost like the vendors have given up, and are just singing occasionally to the media to avoid losing face. For network vendors, that would mean accepting the status quo, which is always a tempting strategy for an incumbent. For non-network vendors relying on SDN/NFV transformation to expand their role (especially the server vendors), it’s accepting no role at all.
It’s hard not to believe that somebody isn’t going to get sensible in this mix, particularly given that the operators have two tracks that will lead eventually to real transformation, real infrastructure change. It’s just hard to say who’s going to lead the charge from the vendor side, and that means that the opportunity is still wide open. Takers, anyone?