Intel envisions a multibillion-dollar opportunity to bring its chipsets into network infrastructure as more and more operators turn to Network Functions Virtualization (NFV) and run commoditized servers and other gear. Carriers are just starting this process with their vendor partners, but Intel sees AT&T's (NYSE: T) Domain 2.0 initiative to get vendors to virtualize their hardware as a promising opportunity, according to Intel's Rose Schooler.
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In an interview with FierceWirelessTech, Schooler, the general manager of Intel's communications infrastructure division, said that for a decade Intel has been working to get its chipsets into network gear. However, that process started to accelerate in the past 12 months as carrier interest in NFV picked up and as Intel gained more expertise in the area, including its December 2013 deal for the wireless assets of Mindspeed Technologies.
Schooler noted that there are already operators around the world that have worked with network vendors using Intel technology for commercial virtualized deployments. One was with Korea Telecom's Cloud Communications Center, and more recently Intel was a part of Alcatel-Lucent's (NYSE: ALU) announcement that it would deploy virtualized radio access network (RAN) software for Saudi Arabian operator Mobily, she said.
Schooler was more circumspect on any forthcoming U.S. deployments, but she said, "We understand AT&T's interest in Domain 2.0, and we will provide any technology support that they need to make that transition." She said Intel is talking to AT&T and other carriers.
Domain 2.0 is AT&T's program to get its vendors to embrace NFV and Software-Defined Networking (SDN). NFV lets carriers virtualize hardware functions and turn them into software within their networks. By running commodity hardware that uses customized software, carriers can cut costs. SDN enables carriers to then use software to control network functions and policies in the cloud and more easily replicate software throughout their networks. All of those trends are opening up opportunities for Intel by forcing carriers and their vendor partners to move away from older, customized solutions.
"I think it provides us with a unique opportunity that we haven't had before," Schooler said. She added that there "will be competitive solutions in the market. But what I would argue is we're going continue to work to do one thing, and that's align our architecture and technology to solve the end-user problems of the operators."
Intel sees its main competitor in network chips as ARM Holdings and the companies that use ARM's architecture. Legacy network chip players like PowerPC and Texas Instruments are looking to convert to ARM-based solutions, Schooler said. Going forward, the market will go one of two ways, either to Intel or ARM-based firms, which includes the likes of Qualcomm (NASDAQ:QCOM), Broadcom and Cavium, depending on what part of the network is being discussed.
There is some concern among carriers that NFV and SDN are being over-hyped, but Schooler said she thinks carriers and vendors have proved that the technology can work. "I think we've transitioned through the hype curve. That's not meant to say we don't have challenges," she said. "I don't want to make it sound like it's all wine and roses because I don't believe as an industry we're there yet." However, she said the industry is past the phase of determining whether the technology will work.
Right now, Schooler said there is momentum around moving to virtualized evolved packet cores (EPCs), as well as Cloud RAN. Within telcos and enterprise IT, she said there is a lot of virtualization of network security functions.
However, Schooler said she did not want to minimize how difficult it will be for some operators to make the shift to NFV, calling the move "transformative from a cultural and organizational perspective."
"We need to get, as an industry, our arms around, how do you take an operator that may be used to rolling trucks and deploying equipment to doing orchestrated provisioning of services based on the needs of the application?" she said. "That's a completely different set of skills. I think it's a completely different culture."
Still, Schooler said that the total network infrastructure chipset market is a $16 billion opportunity. Without giving a specific revenue target for Intel in that larger market, she said, "We see a substantial multibillion-dollar growth opportunity for the Data Center group and for CSIG in networking." She added: "We really want to make Intel a networking company."
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