Inside-out or outside-in? That’s the biggest question in network transformation, for operators and for vendors alike. It’s a question that involves assessing a lot of complex factors, ranging from the nature of new network technology ideas, sunk costs and financial depreciation, budgets, mindsets, hopes, and fears. The balance of these forces is constantly shifting, but there are some signs that things are stabilizing, and that’s important for everyone in the field.
It’s been about two decades since our last “transformation” in networking, the point where consumer broadband and the Internet combined to shift operator investment decisively from TDM toward packet and IP. That transformation was driven by opportunity, the first opportunity to turn consumers into an army of broadband buyers.
Since then, operators have found themselves trapped in a snare of their own making. Consumers were unwilling to pay proportionally for capacity, so the competitive dynamic of the market forced operators to provide more capacity for little or no incremental revenue. This declining profit per bit has put a damper on telecom spending for years now, and it’s the major factor cited by the network equipment vendors as they moan to Wall Street about systemic forces that are hurting their growth.
We’ve had many initiatives that promised to improve profit per bit by reducing cost per bit. Some have focused on streamlining operations, and these have been largely successful, but they’ve impacted customer support and operator reputation. Some have focused on reducing capex, and things like SDN and NFV have failed to deliver on the hopes of their proponents. Other things, like “white box” networking, are showing promise.
The inside/outside situation I opened with is a result of the tension between these “inside” network infrastructure movements and another force, the 5G modernization force that’s attacking network infrastructure from the outside. The consequences of the collision of force themselves are significant, and when a winner is decided, it will likely decide the fate of a bunch of products, or even vendors.
The “inside” force in network transformation has, in theory, both a capex and opex dimension. On the capex side, “transformation” has been recently focused primarily on white-box networking, primarily because the current proprietary-box networks can be evolved more easily if we presume box-for-box substitution. The barrier to real transformation has been the fact that the residual depreciation on network devices has a wide range, and where it’s large, it’s difficult for operators to bear the write-down cost.
Operators also relate a significant problem of finger-pointing that arises when you introduce one (or a few) new boxes into the router-network mix. One operator said “We never had a fault isolation problem before, and now we have a problem with every fault.” They believe the incumbent vendor or vendors are trying to discredit the new devices, which is likely true.
The opex dimension is, of course, related to this. One solid truth in network operations is that “Change is bad until proven otherwise!” People are conditioned to a given set of practices and tools, and any changes in either will generate confusion, pushback, and likely higher costs, at least for a while. For that reason, an increasing number of white-box proponents are focusing on operations transparency, which means looking like an incumbent box in all respects.
Box-wise substitution, even with measures to mitigate operations issues, is kind of death of a thousand cuts, because every new box brings a new flood of protests from incumbent vendors and their supporters. Given that major router vendors have certification programs whose certificates play a big role in proving professional advancement and securing job security and mobility, there are a lot of those supporters in any operator organization.
One could argue that the larger problem in the mister-inside evolution of networks is the lack of a new network architectural model. We are surely short-changing transformation by insisting that everything look the same as it always did, and run the same as well. Operators admit that their operations automation projects tend to bit off little low-apple chunks of cost rather than addressing the overall operations picture, but they can’t do better without knowing how “better” would fit together. That’s true on the capex side too; one reason both SDN and NFV fell short was lack of a credible overall model of how a software-defined or virtual-functionalized network actually looked.
We’re seeing some successes in the inside-out space, where there’s a credible driver to making a change to an entire part of a network—a geographical area or something like the IP core network. The core has proven a fruitful target because core routing is distinctively different (increasingly it’s about shuffling label-switched paths) and often doesn’t involve a huge number of devices. Where operators’ demand density is low, radical core-network capex reduction looks really attractive.
What’s pretty clear at this point is that the majority of operators, particularly the larger ones, are having a problem with even core-replacement strategies. Some (Tier Threes in particular) don’t really have much of a core. Some have high enough demand density that their infrastructure is fairly cost-efficient. For the rest, it’s a long slog through the CFO’s approval process, and that’s why the “outside” strategy looks better for some.
The big advantages of the outside-in transformation, based on 5G, is first that 5G is budgeted, second that 5G standards call for function hosting, and third that there’s already open-model 5G options in play. Open RAN is gaining a lot of traction, for example. But for many, the big advantage is that “services” and any personalization of handling is traditionally an edge function, and that’s where 5G infrastructure goes. In fact, 5G may be converging wireline and wireless at the edge.
I think that the real benefit of a 5G-inward approach to transforming network infrastructure is the combination of the practical and theoretical from the benefits I listed above. On the practical side, 5G is budgeted and happening on a broad scale. On the theoretical side, 5G’s scope matches the part of the network where service value is created; the deeper you go, the more things look like simple bit-pushing. If I’m right, then Open RAN is the single most important networking initiative of our time.
Something with this much positive potential just has to have a downside, of course. The big downside for the outside-with-5G approach is that 5G’s business case is sketchy, budgeting notwithstanding. There is surely a value for 5G RAN, in the subscriber density per cell and in 5G/FTTN hybrids for fixed wireline service replacement. Beyond that, you’re entering the Great Question Mark, where CFOs dig past your high-sounding statements and demand to see hard ROI numbers. They’re not easy to come by, and that means that 5G is at risk for being discredited as a broad-scale technology revolution. That could mean that the service potential that 5G could bring will never come.
It would seem that the logical response to the inside/outside dilemma would be a “both-sides” approach, meaning the combining of 5G-driven edge initiatives with more generalized modernization strategies, including white-box networking. We already have white-box initiatives at the edge, after all, driven by 5G. Couldn’t they be pushed deeper? Sure, obviously, but the question is whether we could promote any additional business cases for doing that. The one place that seems fruitful in the uniting of our two sides is the control plane.
I’ve pointed out the benefits of separating the IP control plane, and uniting it with 5G’s control plane, in prior blogs, notably HERE. Topologically speaking, a new control plane model is the logical place to unite everything in a transformed network; it spans everything (or could). Technically speaking, a united control plane would allow service features and benefits, applied at the edge, to be coupled with deeper behavior, as deep as the business case permitted. It would also provide a mechanism to coordinate edge behaviors throughout a service, even if the core didn’t participate.
Most sellable experiences are rooted in hosted content or applications, meaning they’re run in a data center somewhere. If 5G edge features were coupled to data center networking features, then all those experiences could be optimized at both the requestor and supplier endpoints. Would it be possible to use a separate IP control plane, merged with 5G’s control plane, for this?
Yes, but. The “but” is that something like this is almost certainly going to require either standardization or open-source implementation. If we look at IP topology exchanges today, they’re adaptive on a per-hop basis, meaning that routers pass things along in a kind of vast daisy chain. Could we simply say that a combination of core topology and edge reachability could be more widely advertised? Could we propagate reachability directly from the edge to other edges? Sure, if we agreed on a mechanism that could be widely supported.
That’s one reason why 5G’s outside-in value may be decisive. 5G could converge all broadband under a single edge approach, either because of 5G/FTTH hybrids that used some 5G control plane features, or simply for effective roaming between WiFi and 5G. The concept of an edge partnership over a more passive core could be an outcome.
That suggests that the biggest value for a separate control plane for IP is that it facilitates 5G control plane integration. If that’s true, then it means that most vendors who advocate control plane separation will have to take a harder look at integrating 5G control plane features, and that could give rise to a major shift in how service control planes in other areas, ranging from CDNs to service meshes and cloud computing, are handled.
That may have to happen quickly too. The market in 2021 is going to be very competitive, and a decisive link between open-model 5G and open, transformative, network technology in general would be pretty compelling to operators looking for profit-per-bit relief. The earliest well-stated positions in the space could be decisive.