Telcos must rethink service models in wake of SDN and NFV

Software-defined networking and network functions virtualization have caused waves across numerous industries, but nowhere has their impact been more deeply felt than in the telecom sector. As organizations that wholly rely on their expansive networks to provide services to customers, telcos are acutely aware of the importance that quality service delivery holds. These technologies promise to completely revolutionize the manner in which carriers manage their internal environments, enabling them to dynamically make changes and vastly improve traffic speeds. Telecoms must be prepared for this burgeoning trend and consider how their operations will change in the coming years, as service providers and equipment manufacturers alike will be affected by the development and proliferation of SDN and NFV.
The advent of SDN and NFV couldn’t have come at a better time. Carriers are pushing their networks to the limit, with many struggling to support their customers’ high performance demands on their existing infrastructure. In March 2013, Huawei CTO Sanqi Li cautioned that as operating expenditures continue to increase and network resources dwindle, telecoms will require an alternative solution.
“We’re looking at the fundamental limit of existing network infrastructure,” Li said, according to Telecoms.com. “Today’s network architecture is closed, protocol-centric and vertical, fragmented and with software embedded in the network devices.”
However, technology such as SDN can effectively address these concerns and put carriers back on the path toward business growth and success.
SDN, NFV alters network management needs
Fujitsu further highlighted the need for SDN and virtualized network resources in a 2013 report. The IT equipment provider explained that SDN will enable telecoms to improve both the time and quality of service delivery. In addition, carriers can make better use of their various resources, driving down their hardware, personnel and operating costs. Fujitsu offered the example of a certain connection requiring a 50 Mb bandwidth boost. To carry out such a task within a traditional telecom infrastructure, organizations would need to coordinate several teams and network engineers to change bandwidth settings as well as router and switch settings. As portrayed, this is a time-consuming and costly process involving many business units working in concert. Meanwhile, an SDN-enabled carriers could make such changes quickly on an as-needed basis. This shift in asset management could completely alter the manner in which telecom services models are structured, with network operators having more dynamic control over traffic and service delivery.
“An open northbound interface means that users can build their own applications and are not waiting on management system vendors to deliver features that they need now,” the report stated. “More than that, there are applications that can cross multiple domains that could never have been addressed in the past.”
Collaboration continues to be key
To get the most value out of SDN and NFV, telecoms will likely need to reconsider how they organize their service models. Ovum principal analyst David Krozier recently addressed these concerns, explaining that telecoms are beginning to recognize the need to form partnerships with service providers in order to utilize SDN and NFV to the technologies’ full benefit. He urged telecoms to initiate a culture change within their organizations, particularly regarding how they approach their asset integration and service delivery procedures. Several notable examples in the telecom sector offer some guidance for how companies should proceed with these tasks.
“AT&T’s Domain 2.0 program is evidence of the deep-seated change occurring in the companies’ procurement processes as a result of SDN and NFV,” Krozier wrote. “Handling these changes, and the cultural impacts within the organization, is critical to the future role of [communications service provider] networks.”
AT&T officials have lauded the collaborative nature of the organization’s Domain 2.0 program, stating that the formation of partnerships with other industry members focused on a shared goal has helped cut time to market in half. Overall, this shift in focus has resulted in lower operating costs and the creation of a more sophisticated network capable of supporting faster speeds.
Telecom leaders will need to take such matters into consideration when making the jump to SDN or NFV. These technologies will be major components of future telco operations, but the transition will likely require a shake-up in how a company does business. Carriers will need to reshape their service models in such a way that facilitates the integration of SDN and cashes in on its performance-enhancing potential.