Software-defined wide area networking (SD-WAN) has become the poster child for successful NFV and SDN deployments today. Just about every major telco with fixed-line assets is either offering SD-WAN services, or working on how to offer SD-WAN in the near future. And, the technology even holds promise for wireless carriers that could use fixed wireless access to deliver SD-WAN.
SD-WAN is proving to be an opportunity for increased revenue for many service providers, and can act as a platform for future add-on services, including managed IT and security capabilities. It also allows service providers to add value on the connectivity side, partnering or reselling alternate connectivity options as well as bundling-in direct access to public clouds or popular software-as-a-service (SaaS) applications.
Many SD-WAN solutions are based on overlays, which currently allow managed service providers (MSPs) who don’t own or control physical connectivity to provide managed SD-WAN solutions, regardless of who plumbs the last mile (or for that matter, who interconnects the disparate networks). Some SD-WAN vendors also sell overlay solutions directly to enterprises.
This overlay property of SD-WAN also makes it possible for a service provider to sell SD-WAN into locations dominated by incumbent fixed operators, effectively making the service provider an MSP for an over-the-top SD-WAN service. Some service providers view this as a chance to break into new markets, or to cement the relationship with existing enterprise customers by providing managed reach into locations they don't directly have fixed-line assets in, for example, remote offices in another region or country.
SD-WAN and the promise of 5G FWA
Just as SD-WAN provides fixed line service providers or MSPs with the ability to deliver managed network services into locations where they don't have fixed line assets today, 5G fixed wireless access (FWA) can potentially allow mobile service providers to have last mile connectivity to both urban and potentially rural subscribers as well.
I'd like to point out, as others have before me, that FWA isn't new; we've been here before with LMDS and then again with WiMAX. And, both were not particularly successful as business initiatives, for a whole host of reasons. 5G FWA is interesting because of performance characteristics that rival next-gen copper and fiber connectivity speeds. It also comes with a promise that costs will be much lower thanks to savings from reduced infrastructure and civil engineering spend, as there will be no trenches to dig nor fiber to lay.
So with 5G FWA, mobile providers could ostensibly offer business SD-WAN services, providing coverage without the expense of laying fiber or upgrading a cable plant. Mobile providers could be in a position to be the prime supplier of SD-WAN services, using 4G LTE as a backup, or roping in other connectivity options for direct internet access, such as cable and DSL, but with the mobile carrier as the primary managed provider for the service.
In many ways, it's an appealing vision where a CPE drop shipment from the carrier can self-provision once powered up on a wireless network, without the complexity of a truck roll, and light up high-speed service anywhere within the coverage area. And, for a mobile carrier in the SD-WAN space, moving from a position of being a backup LTE link to primary connectivity with 5G FWA feels like a step up, and provides a chance to take control of its relationship with the enterprise.
SD-WAN with 5G - a work in progress
The positives in 5G today are that large carriers like Verizon and AT&T are rolling out FWA in select markets. And, we're now seeing roll-outs for both line-of-sight use cases and other cases where the signals are refracted or reflected off foliage and buildings. However, we're still working through the economics of 5G FWA deployment, figuring out if outdoor units are necessary when confronted with buildings with low-emissivity glass, and understanding the costs involved in deploying enough 5G mmWave small cells to provide sufficient coverage even in urban service areas.
It might be a while before 5G FWA becomes a compelling driver for a mobile carrier to offer SD-WAN services. Instead, mobile carriers that are looking to provide value for their business customers should evaluate if they are in a position to go to market with SD-WAN services independent of (or at least ahead of) widespread 5G FWA.
Some possible go-to-market paths for mobile carriers evaluating offering SD-WAN services include exploiting the ease-of-deployment angle. For example, shipping a CPE that auto-configures by using LTE to bootstrap a wired connection can provide greater ease of bring-up than one dependent on getting the wired connection to do the right bring-up dance.
Or, perhaps the go-to-market strategy might be as simple as leveraging the position of the backup LTE link, and then finding one or more direct internet access partners, and approaching enterprises with a single point of responsibility pitch.
The situation will evolve as 5G roll outs become more prevalent. For now, it's more likely that these go-to-market approaches are more pragmatic and immediate for mobile carriers looking to offer SD-WAN services than for those looking to leverage 5G FWA as the key driving factor.
Roy Chua is founder and principal at AvidThink, an independent research and advisory service formed in 2018 out of SDxCentral's research group. Prior to co-founding SDxCentral and running its research and product teams, Chua was a management consultant working with both Fortune 500 and startup technology companies on go-to-market and product consulting. As an early proponent of the software-defined infrastructure movement, Chua is a frequent speaker at technology events in the telco and cloud space and a regular contributor to major leading online publications. A graduate of UC Berkeley's electrical engineering and computer science program and MIT's Sloan School of Business, Chua has 20+ years of experience in telco and enterprise cloud computing, networking and security, including founding several Silicon Valley startups. He can be reached at [email protected]; follow him at @avidthink and @wireroy
Industry Voices are opinion columns written by outside contributors—often industry experts or analysts—who are invited to the conversation by FierceTelecom staff. They do not represent the opinions of FierceTelecom.