SDNs: Key to Accelerating the Adoption of Public Cloud-Based Services?

Today’s cloud-based services, while clearly ground-breaking, still have important gaps to fill, such as in the reliability and integrity of their service delivery infrastructures, or the degree of automation they use for activating and managing services, before the full promise of the cloud can be achieved.. While the baseline of many offerings is in place, many efforts to close these gaps are furiously underway.

Alongside the virtualized infrastructures of the cloud computing data center, an additional domain in which important progress remains to be made is in the quality, performance, and agility of the communication networks cloud providers leverage to deliver their offerings. As things stand today, many service offerings are limited in responsiveness, performance, and scale because of the limitations of the communication networks on which they are relying. The effects of the limitations vary by the operator’s location, operating model and asset pool. For example, cloud SPs running over the top of the Internet to their customers have a different set of issues to address than SPs offering cloud-based services on top of customer-connecting networks they already own. 

Stepping it up

Some steps have been taken to reduce the size of the gaps. For example, many operators have developed cloud VPNs that activate special properties for enterprises and over-the-top customers to improve their experiences. However, the agility of these offerings is constrained in many cases by the multivendor, multidomain nature of SPs’ infrastructures, and activating suitably powerful SLAs for both wireline and wireless customers still poses significant challenges.

Which brings us back to the essential question of this note: do SDNs present a special opportunity for operators to accelerate the success of their public cloud-based services? The short answer is, they may. A resounding yes will depend on how pervasively operators and suppliers embrace the paradigm, as along with the pace of their uptake.

Promises, promises

SDN has the potential to normalize templates for deploying a wide range of services on top of heterogeneous network infrastructures. In cloud-based services, one can easily imagine an SP constructing service templates for offerings it wants to support which could be overlaid consistently onto its underlying networks. In this mode, an SP could activate any cloud-based service it has on its menu from burst compute, storage archiving and cloud-based software development to distributed m2m and real-time conferencing on demand and without constraint. The templates would be consistent, and deployment could be achieved in any topology required.

Accelerating the path to the cloud

By leveraging this basic flexibility, software-defined networks could accelerate the feasibility, speed of deployment, and rate of acceptance of a broader range of cloud-based services than is achievable today. SDNs also have the additional virtue of each operator injecting its own differentiating value into its service offerings. 

If early implementations yield positive results, it will be clear SDNs have a role to play in accelerating the creation of superior clouds by removing barriers to achieving the agility customers expect before embracing the cloud-enabled world with confidence. The only remaining questions will be, by which operators, for which services and customers, and how fast?

For more information on ACG's cloud services and SDN services, contact sales@acgresearch.net.

Paul Parker-Johnson
pparkerjohnson@acgresearch.net
 www.acgresearch.net

Seven Myths of Machine to Machine

Interest in machine to machine has been gaining considerable momentum in both the press and industry and is expected to boost new productivity in many industries and require a new IT ecosystem. 

The interest in machine to machine (M2M), sometimes called the Internet of Things or IoT, is prompting a degree of hyperbole in the industry—as often happens with new technology. In addition to inflating expectations, too much hoopla can confuse the market and detrimentally overshadow some of the realities of drivers, adoption rates and addressable market size. In spite of the hype (which is typical in the early adoption cycle), M2M is a substantive technology transition that will create a new market and ecosystem. However, the industry needs a reality check related to the myths associated with M2M.

Click here to download the Market Impact.

David Dines
ddines@acgresearch.net
www.acgresearch.net

Increases in Total Worldwide Service Provider Carrier Router-Switch Market Projected

The Total Worldwide Service Provider Carrier Router-Switch market is projected to moderately increase from $11.7B to $15.1B by 2018. From a regional perspective, APAC and the Americas, respectively, will lead the growth as carriers respond to increases in data traffic, big data, virtualization, software-defined networking and the unrelenting demand for innovative and intelligent applications and services. The projected five-year growth will be strongest (in order of growth) in APAC (CAGR +6.4%), Americas (CAGR +4.9%), and EMEA (CAGR +4.9%). ACG anticipates that the total router and switching market will increase 4.6% in 2013 as well as increase in each successive year. 

In spite of challenges facing global economies, the emphasis on new and innovative services will instigate a significant shift in networking. Cloud services and machine-to-machine connectivity, which have redefined the way applications run on the network, exposing their underlying limitations, have contributed to the explosion of inter-data center traffic. The long-term demand for high-performance and innovative networks/architectures that address inter-connected data centers will increase in momentum. 

In the next five years service providers will continue to focus on monetizing emerging opportunities, which will require networks that enable them to accelerate service innovation, scale services, and expand the customers’ experiences all within a viable economic framework. Service providers are looking at vendors’ solutions that provide a single operating system, operational simplicity and a platform with the highest possible scale across bandwidth, subscribers, and services. 

For more information about ACG Research's syndicated and consulting services, contact sales@acgresearch.net.

Ray Mota

rmota@acgresearch.net

www.acgresearch.net

OpenDaylight: The Break-Away Moment for SDN

The Linux Foundation just announced the formation of a new open source development project intended to harness contributions from a wide range of cloud and networking industry participants to accelerate development of a consistently structured framework for software-defined networks or SDNs. This announcement is a watershed in the networking industry’s evolution, as it holds the potential to break multiple categories of developers free from the constraints of sometimes hopelessly constrained API constructs. By bringing firms as diverse as Cisco, IBM, Juniper, Red Hat, Microsoft, Intel and VMware (to name just a few) together in a mutual tryst to contribute intellectual energy and technology contributions to a normalized set of SDN building blocks that can serve as the foundation on which other application innovations can be built, the networking community has arrived at a milestone that has the potential of being its lift off point toward an unprecedented range of innovation. Multifaceted application systems may just end up having a rich catalog of easily integrated capabilities that will accelerate their uptake and deployment.

Is this rosier picture of network-savvy applications a guaranteed outcome of OpenDaylight’s work? Hardly, the outcomes remain to be seen from the efforts of its contributors. But is the possibility of a rapidly developed and richly endowed common foundation of SDNs significantly improved by forming the OpenDaylight Project versus limping along with the smorgasbord of SDN approaches we have been experiencing in the first year of two of the paradigm’s emergence? It’s hard to arrive at a different conclusion, when you think of the range of talents assembled toward achieving the project’s objectives, and imagine the best practices in open source platform development that can be brought to bear on the process with the Linux Foundation’s experience close at hand. The full Internet community stands to be the beneficiary with each company that contributes able to reap some of the benefits for the use cases and applications on which they choose to focus for their customers.

While momentum is only discernible with delivery of concrete capabilities along the project timeline, you can see it foreshadowed by the strength of the contributing assembly. With proper guidance, it would seem the break-away period for SDN is more within sight now than it ever has been before. 

For details about OpenDaylight, click here.

For more information about ACG Research's cloud computing services, click here.

Paul Parker-Johnson

pparkerjohnson@acgresearch.net 

www.acgresearch.net

Building Broadband Past the Saturation Point

U.S. broadband has reached the end of its growth phase, and the industry is now shifting from building infrastructure and acquiring customers to creating sustainable business models. 

The U.S. fixed-line broadband market appears to have reached the saturation point. The most recent FCC broadband report with data through 2011 indicates that about 80% of U.S. households are served by fixed-line broadband. It also shows the classic S shaped market development curve with the last inflection point in the S occurring in 2007. This data, when combined with year-end 2012 data from the largest fixed-line broadband operators, confirms market saturation. Fixed-line broadband connections for 4Q12 compared to the previous year showed little change: AT&T (NYSE: T) 0.3%, CenturyLink (NYSE: CTL) 3.5%, Comcast (Nasdaq: CMCSA) 6%, and Verizon (NYSE: VZ) 1.4%.

Click here to read Michael Kennedy's FierceTelecom article.

For more information about Michael Kennedy, click here.

Click here for more information about ACG's business case analysis consulting research service.

Michael Kennedy

mkennedy@acgresearch.net
www.acgresearch

The Business Case for Ethernet Services for Mid-Sized Businesses

Network-based applications such as Voice over IP (VoIP), cloud, collaboration services and video applications of all kinds are driving the need for high-speed, high-quality and reliable networks that exceed the capabilities of the services many businesses are using today. Bandwidth requirements are forcing growing businesses to rethink their networking solutions. For example, we estimate that mid-sized business sites will require 25 Mbps to 85 Mbps of bandwidth over the next three years. TDM-based access networks in use today are poorly positioned to meet these emerging network service needs. They do not scale easily to meet higher bandwidth requirements, and quality guarantees and resiliency features must be added via a switching or routing overlay.

Ethernet services scale from 1 Mbps to 10 Gbps and beyond and have built-in quality and resiliency features that are compliant with industry-standard Carrier Ethernet specifications. When combined with an Ethernet LAN, Ethernet services provide an end-to-end Native Ethernet solution. This makes Ethernet services easier to install, operate and maintain than TDM-based access service alternatives.

For typical mid-sized businesses, ACG Research compared the monthly recurring costs of Ethernet versus TDM access for point-to-point, point-to-multipoint, and multipoint-to-multipoint network configurations. We found that Ethernet services have 56 percent to 71 percent lower costs than TDM-based alternatives. In addition, Ethernet services provide a complete end-to-end solution, while a switching or routing overlay must be added to the TDM access service to create a complete solution.

An analysis of scaling economics of Ethernet and TDM/SONET access services shows that Ethernet solutions are available at many bandwidth speeds with gradually increasing prices. In contrast, TDM bandwidth speeds are limited with steep price steps as speed increases. The TDM scaling behavior creates bandwidth barriers to increasing network capacity that can be overcome by switching to Ethernet services. 

Click here too download the whitepaper.

For more information about ACG Research's business case analysis service, click here.

Michael Kennedy

mkennedy@acgresearch.net
www.acgresearch

The Economics of Cisco’s nLight Multilayer Control Plane Architecture

Networks are becoming more difficult to plan and optimize because of high traffic growth, volatile traffic patterns, changes in network architecture and more stringent service level agreements. Because the IP and optical control planes are not integrated, service providers’ networks are always over-engineered and underutilized with 50–75 percent of the network capacity deployed for network resiliency, not for passing traffic. A more economically efficient and effective network resiliency solution is needed.

Cisco has addressed this problem with nLight: a multilayer routing and optimization architecture that focuses on IP and DWDM integration, increasing network agility and flexibility while improving network utilization. ACG Research compared the nLight approach to protection and restoration to the widely used 1+1 optical protection scheme. Click here to download the TCO.

For more on the topic, listen to Eve Griliches and Ron Johnson, Cisco, discuss packet optical convergence and Cisco nLight technology.

For more information about ACG Research's business case analysis services, contact sales@acgresearch.net.

Michael Kennedy

mkennedy@acgresearch.net
www.acgresearch

Juniper Networks Delivers the PTX3000 with 100G Integrated OTN

The proliferation of 100G connectivity in core networks is now spreading to the regional and metro/access areas. The demands in the metro access area are, in fact, similar for scale, connectivity and latency but actually up the bar when it comes to footprint, power utilization and lower BTUs per Gpbs.

Juniper Networks introduced the PTX5000 at OFC in 2011 and shook up the router landscape with the introduction of the first core-optimized  product on the market that delivers a simple architecture, which both content and service providers can leverage. 

The company has now introduced the PTX3000, which will play an important role in the metro core as Juniper Networks is now delivering the power of the Supercore in a transport package.

Click here to read how this product will impact the market.

For more information about ACG Research's packet optical transport services, contact sales@acgresearch.net.

Eve Griliches
egriliches@acgresearch.net 
www.acgresearch 

Business Case for Shared Mesh Protection

Current approaches to network resiliency are inadequate to meet evolving network performance and cost requirements. Existing schemes such as 1+1 protection meet the sub 50 ms performance requirement but only protect against single failures and are too costly. Best-effort approaches such as software-based GMPLS mesh restoration are cost effective, handle multiple failures but do not meet the sub 50 ms performance requirement. MPLS FRR can protect against multiple failures and achieve local 50 ms performance but requires longer time frames for end-to-end convergence and uses more costly router ports. 

Infinera is implementing a new standards-based approach called Shared Mesh Protection (SMP) for network resiliency. ACG Research conducted a total cost of ownership (TCO) comparison of SMP versus 1+1 protection. The comparison is made for the TCO of line-side 100 Gbps WDM interfaces using a national reference transport network and a five-year study. It models traffic patterns to/from data centers, cable landing sites, and metro areas. Traffic increases at 85 percent CAGR over the study period. The comparison shows that the TCO for protection resources in SMP is 27 percent less as compared to 1+1 protection. The TCO savings result from the use of shared bandwidth managed by network intelligence to protect against multiple failures versus dedicated backup resources for single failure protection used by 1+1.

Click here to download Michael Kennedy's total cost of ownership whitepaper.

For more information about ACG Research's business case analysis service, contact sales@acgresearch.net.

Michael Kennedy

mkennedy@acgresearch.net
www.acgresearch

Cisco Leads in SP Video Infrastructure Hardware and Software Markets

Cisco continues to hold its commanding leadership position in the SPVI market (ACG Research’s Service Provider Video Infrastructure 4Q 2102 Worldwide Market report). Not surprisingly, Cisco has held a leadership position for many quarters based on it strengths in CMTS and packet infrastructure. It is notable that Cisco has been solidifying its position in STBs by taking share from Motorola in IPTV STBs and developing cable STBs (second place in market share).

In aggregate, the SP Video infrastructure market shrunk 2 percent to $13B in 2012. CMTS revenues dropped in the high single digits in 2012 though it remains a $1+ billion industry. CMTS build out is starting to level off as MSOs are completing their DOCSIS 3.0 build out and as port densities are doubling and reducing ASP. Cable STBs have been essentially flat, based on declining video subscribers; however, a mix of HD and DTAs has helped buoy the market. IPTV STBs were also down, driven by price pressures and demand for low-end devices in emerging markets.  Packet Core and BRAS saw double-digit declines in annual revenues; Carrier Ethernet gained modestly.

ACG also published its Video Infrastructure Software and Services Market 4Q 2102 report, which tracks conditional access systems (CAS), digital rights management (DRM), middleware, subscriber software and infrastructure software (head end, workflow, advertising). In the aggregate, Cisco leads this market, based on its strength in CAS. 

When combined, the hardware and software markets are approximately $16 billion in annual revenue. While we have seen a flattening of growth, this sector remains very strategic to SPs. The market is undergoing a transition as SPs deal with 1) competition from over-the-top video competition, 2) how to deliver video to multiple smart devices within the home, and 3) upgrading infrastructure to handle increasing bandwidth demand of consumers.

For more information about ACG Research's video infrastructure services, contact sales@acgresearch.net

David Dines
ddines@acgresearch.net
www.acgresearch.net