SDN & Multi-layer Transport SDN: Notes from Layer123 SDN OpenFlow World Congress

This year’s Layer123 SDN OpenFlow World Congress in Dusseldorf, Germany, was quite an expanded event from last year with over more than 1,500 people registering.

There was a great mix of presentations from equipment suppliers, services providers and open source organizations at the event. SDN and NFV were, of course, top of mind at the event. The number of SDN and NFV PoCs and trials continue to grow rapidly, but live commercial deployments outside the data center remain elusive. Our ideas and thinking about the application of this technology in our networks has, however, matured. The focus has shifted, correctly I believe, from minimizing capital costs with COTS hardware to agile revenue generation via network automation and programmability.

Although many challenges remain, the single biggest barrier to mass SDN commercial deployment is operationalization of the technology. It is not just commissioning either. A virtualized and programmable network must still be operated and managed throughout its life-cycle to meet changing networking demands and customer service level agreements. In one conversation with an equipment manufacture, we discussed the simple scenario of a fan failure in a server running multiple VMs and VNFs. Who would know of the failure? How would they know and when would they know? Part of the beauty of an NFV environment is that the VM/VNF can simply be moved to other physical machines. However, financial considerations will always dictate that there is a limit to the number of physical machines (COTS or otherwise) installed in a service provider network. The underlying physical network will have to be maintained and failures addressed lest they eventually lead to poor network performance and customer satisfaction.

The fact that there was broad acknowledgment about the need to close the operational gaps is encouraging and a major step toward increasing commercial deployments.

Multi-layer Transport SDN was another topic that generated a lot of chatter in both Layer123 sessions and at a lunch-time debating table. Is multi-layer only through Layer 2 or 2.5? Or does it involve Layer 3 and IP?

After some discussion, the general consensus emerged that in order to maximize the value of an agile SDN-enabled network, multi-layer SDN and associated path computation must be Layer 0-3. The value of a multi-layer control plane is significantly diminished if IP is not a part of the solution. Independent fault detection and recovery mechanisms (think path computation) is exactly what we have in today’s networks with the packet-optical layers doing their own detection and restoration while IP executes its own Layer 3 detection and restoration mechanisms with protocols such as BFD and EMCP. Break a fiber in a network and all layers work almost completely independently to restore paths and services at their respective protocol layer.

With SDN and centralized control, we have the opportunity to ensure that wavelengths, ports and paths are coordinated and utilized for maximum efficiency. We can simplify our networks and drive out complexity and operational costs. Must a supplier’s controller and path computation element (PCE) contain Layer 0-3 functionality? Not necessarily. The hierarchical nature of SDN control means that hierarchical-PCE across multiple PCEs is a viable option. Packet optical suppliers could focus on Layer 0-2 PCE but then interface in a hierarchical manner with a Layer 3 PCE partner/supplier. Alternatively, a monolithic Layer 0-3 PCE is also possible but might require tighter coordination and integration than an equipment supplier may want to pursue. Either way, packet optical suppliers need to drive their PCE thinking from a Layer 0-3 perspective if we are to simplify the network, improve equipment utilization/efficiency and create agility for the future.

Click for more information about Tim Doiron or to discuss this topic contact Tim at tdoiron@acgcc.com.

   Tim Doiron
   tdoiron@acgcc.com
   www.acgcc.com

1Q Worldwide Optical Markets Affected by Capex Decreases

The growth rate of 100G optical interfaces remains steady and the trend to support 4G and mobile Internet services is driving expansion in all regions

The Worldwide Optical Networking market decreased in 1Q15 to $2.9 billion in revenue, dropping 13.3 percent q-q but increasing 4.1 percent y-y. With the exception of the Packet Optical Transport segment, which was up 3.9 percent q-q and Sonet/SDH segment, which increased 0.5 percent, all segments of the optical market posted quarterly declines.

The POTS segment, after slow growth for several years, is beginning to see an acceleration driven by the transition from legacy services and operators that need to transition their installed base. In the SONET/SDH segment most Tier 1 service providers have stopped building out or capped spending on SONET/SDH as they transition to newer technologies; however, in other global markets and low-tier carriers, E1 interfaces are still fundamental to operators’ businesses. Legacy players tend to dominate these businesses with development support limited to maintenance.

U.S. Capex in the first quarter was down 14 percent and the second quarter is projected to be down 10 percent. The smaller capex spending in Q1 had a direct impact in the overall optical market. Capex allocation for optical equipment has decreased from 9 percent to 4.3 percent during the last 5 years.

The top five worldwide players in 1Q were Huawei with 15 percent market share; ZTE, 15 percent market share; Alcatel-Lucent, 12 percent market share; Ciena 12 percent market share and Cisco, 8.5 percent market share respectively.

TREND AND DRIVER HIGHLIGHTS

Web 2.0/Webscaller/Co-location capex is expected to grow in 2015 in the $36 billion range and will be a new growth area for selling virtual routers, DCI optical and packet solutions. We expect to see growth with web scale companies growing their capex.

Data center interconnect positively impacts both the optical and packet domain. Currently, ACG sees six to eight percent of edge routers being dedicated to DCI. ACG sees three main areas that will be the foundation for DCI: Optical, Layer 2 and Layer 3.

MSPP solutions continue to decline as subscribers transition from legacy protocols such as ATM and TDM based technologies to the IP/Ethernet environment continues.

100G in metro applications in high demand, which will help drive growth in overall optical market.

For more information contact sales@acgcc.com.

Ray Mota

rmota@acgcc.com

www.acgcc.com

Worldwide Optical Market Increases Slightly in 4Q

Demand for rich media and OTT services to the home and mobile devices are market trends that continue to pressure providers to move DCs into the metro and enhance core infrastructures

The Worldwide Optical Networking market rebounded slightly in Q4 2014 to $3.375 billion in revenue, dipping 7.0 percent q-q but increasing 2.7 percent y-y. The year closed with annual revenue of $13.1 billion, 0.9 percent y-y increase. Demand for high-speed optical infrastructure remains steady, driven by increased sales of 100G interfaces in the Metro and LH WDM segments. “The 4Q revenue jump has been observed within the optical market for the last three out of four years. The year-over-year growth indicates a slight increase of spending but not necessarily a bullish market,” stated Dennis Ward, principal optical analyst, ACG.

Regionally, APAC is the top producing region though revenue declined 5.3 percent q-q. North America remained in the 2nd position, increasing 7.8 percent q-q and up 25.4 percent y-y. EMEA remained a strong 3rd at 11.4 percent q-q but showed a dip of 5.2 percent y-y. LAM improved with 6.3 percent q-q and 10.2 percent y-y growth.

The growth rate of 100G optical interfaces remains steady. The trend to support 4G and mobile Internet with its rich services is driving this as well as 400G trials in all regions. But 400G standards are still in flux. Although the Tier 1 communication service providers gear up for 2015, many of the optical equipment providers are finding a real market with the content service providers (CSPs) as they migrate their data centers into the metro closer to their customer bases. Some of these CSPs are looking for simple high- capacity solutions via dark fiber across the metro; others want more sophisticated long-haul solutions into the metro. “We see the demand for DCI bifurcating into two distinct market segments of products, small slot versus multislot solutions,” says Dennis Ward.  

Service provider SDN and NFV in combination with P-OTS/Metro WDM solutions are gaining traction in network infrastructure selection and deployments. P-OTS segment saw a quarterly dip in its revenue contribution but maintained its $.5 billion run rate, decreasing 7.9 percent q-q but increasing an impressive 28.9 percent y-y. The top five worldwide players in 4Q were Huawei, ZTE, Ciena, Infinera and Alcatel-Lucent, respectively.  

Metro WDM maintained its quarterly $1 billion run rate but decreased 0.7 percent q-q and 9.2 percent y-y. Metro traffic is predicted to grow faster than backbone traffic as more regional data centers are located closer to the user community. As much as 70 percent of the traffic is predicted to stay within the metro from which it originated, bolstering east-west traffic between data centers. The increase in DCI supports this trend and will drive the need for additional capacity by the traditional service providers, MSOs, cloud and data center operators.

For more information about ACG's optical services, contact sales@acgcc.com.

Dennis Ward

dward@acgcc.com

acgcc.com