AT&T Mobility's (NYSE: T) "User-Defined Network Cloud" initiative, which makes use of Software-Defined Networking and Network Function Virtualization, is aimed at transforming the carrier's network. AT&T wants to virtualize hardware functions, cut costs and put more control of its network in the cloud and in the hands of users, both in the consumer and enterprise markets. But what will that effort mean for the company's network equipment suppliers?
"It really is very disruptive technology in terms of the supply chain. They have to change in very fundamental ways," explained Marian Croak, senior vice president of AT&T's Domain 2.0 architecture and advanced services development. "The way that we used to work with the supplier community was that they would build specialized, proprietary hardware that was tightly coupled with software. They have to break that apart now and run software on commodity hardware, which we call white boxes, which are a lot less expensive than what we used to have. And then they have to virtualize their software."
For more on how Domain 2.0, SDN and NFV will change AT&T and the wider telecommunications market, check out this FierceWirelessTech Hot Seat with Croak.