Virtualized Networks Will Disrupt Supplier Business Models

The shift to virtualized networks, as you would expect, will disrupt the telecom infrastructure supplier market. That pattern already is happening in the data center market as well, as open source, virtualized and “do it yourself” approaches to data center infrastructure have taken hold.  

"Part of the challenge for the vendors is that it certainly upset the vendor business model, because instead of buying boxes we were now going to buy software and buy it in smaller chunks, and we've been vocal about having open source play a key role in the ecosystem," says Krish Prabhu, AT&T CTO.

More is coming. The Telecom Infra Project, initiated by Facebook but now supported by a number of leading telecom infrastructure suppliers, also is working to essentially commoditize hardware and create more functionality on an open and “computing-style model.”  

The project aims to to “develop new technologies and approaches to building and deploying telecom network infrastructure,” according to Jay Parikh, Facebook global head of engineering and infrastructure.

Facebook, Intel, and Nokia have pledged to contribute an initial suite of reference designs, while other members such as operators Deutsche Telekom and SK Telecom will help define and deploy the technology as it fits their needs, said Parikh.

Telecom Infra Project  members will work together to contribute designs in three areas including  access, backhaul, and core and management.

Significantly, the effort will apply Open Compute Project models of openness and disaggregation as methods of spurring innovation. In other words, in addition to relying on open source, the Project also will rely on use of standard, “commodity” hardware.

“In what is a traditionally closed system, component pieces will be unbundled, affording operators more flexibility in building networks,” Parikh says.

The net result is that telecom networks will cost less in the future. Not only are service providers moving to adopt virtualized approaches to network gear, with firms such as Facebook pushing that model, but rival platforms, including cable TV networks and coming fixed wireless and mobile networks already are suggesting that lower-cost access models are possible.

The AT&T  Domain 2.0 program, based on use of software-defined networks (SDN) and network functions virtualization (NFV), is part of that shift.