NICE, France--Savings in both operating and capital expenditure are often cited as leading drivers behind the move towards software-defined networks (SDN) and network functions virtualisation (NFV), but operators themselves say service agility and new revenue really make the business case.
According to research conducted among global telecoms operators by Infonetics Research, while cost reductions count, revenue is the number one driver. Michael Howard, co-founder and principal analyst at the company, told delegates attending the SDN & NFV 2014 summit here this week that vendors will start to get some revenues from SDN and NFV products in 2016, when an early market should start to take shape. However, these developments are not expected to become more widespread until 2019 or 2020.
"There are many challenges and hurdles to be overcome first," Howard said, adding that the development of an orchestration control layer that knows what is going on in the network is one of the main challenges that still lies ahead.
The analyst emphasised that the move towards SDN and NFV is a continuous process; there is still a great deal to do before the market becomes fully developed.
Howard said 2013 and 2014 have been "proof of concept" years, although this year there is more evidence of vendors and service providers making the software more commercially viable.
"We're not there yet," Howard said, noting that operators tend to focus on getting a few projects to field trials before moving on to the next set of planned projects.
Slovak Telekom outlines virtualisation progress
Telefónica exec emphasises need to avoid vendor lock-in with NFV
Facebook net systems head says operators must embrace SDN
5GPPP says fresh approach needed for future network development
NFV a dominant theme at this year's TM Forum Live