The SDN, NFV & Network Virtualization Bible: 2015

The SDN, NFV & Network Virtualization Bible: 2015 – 2020

Opportunities, Challenges, Strategies & Forecasts

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Table of Contents

1 Chapter 1: Introduction ................................................................................... 20

1.1 Executive Summary ....................................................................................................................................... 20

1.2 Topics Covered .............................................................................................................................................. 22

1.3 Forecast Segmentation ................................................................................................................................. 23

1.4 Key Questions Answered ............................................................................................................................... 25

1.5 Key Findings ................................................................................................................................................... 27

1.6 Methodology ................................................................................................................................................. 28

1.7 Target Audience ............................................................................................................................................ 29

1.8 Companies & Organizations Mentioned ....................................................................................................... 30

2 Chapter 2: An Overview of SDN, NFV & Network Virtualization ....................... 36

2.1 What is Network Virtualization? ................................................................................................................... 36

2.2 What is SDN (Software Defined Networking)? .............................................................................................. 37

2.3 SDN Protocols ................................................................................................................................................ 37

2.3.1 OpenFlow .......................................................................................................................................... 38

2.3.2 BGP-TE (Border Gateway Protocol - Traffic Engineering) ................................................................. 38

2.3.3 PCEP (Path Computation Element Protocol) ..................................................................................... 39

2.3.4 I2RS (Interface to the Routing System) ............................................................................................. 39

2.3.5 VxLAN (Virtual Extensible LAN) ......................................................................................................... 40

2.3.6 ALTO (Application Layer Traffic Optimization) .................................................................................. 40

2.3.7 IETF Software Driven Networks ......................................................................................................... 40

2.4 SDN Implementation Approaches ................................................................................................................. 41

2.4.1 Network Virtualization Approach ...................................................................................................... 41

2.4.2 Evolutionary Approach ...................................................................................................................... 41

2.4.3 The “Central Control” Approach ....................................................................................................... 42

2.5 What is NFV (Network Functions Virtualization)? ......................................................................................... 43

2.6 NFV Enabling Technologies ........................................................................................................................... 44

2.6.1 Cloud Computing and Network Virtualization................................................................................... 44

2.6.2 Open Management and Control Protocols ....................................................................................... 44



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2.6.3 Industry Standard High-Volume Servers ........................................................................................... 44

2.7 NFV Implementation Architecture ................................................................................................................ 45

2.7.1 NFVI (NFV Infrastructure) .................................................................................................................. 45

2.7.1.1 Hardware Resources ..................................................................................................................................... 45

2.7.1.2 Virtualized Resources .................................................................................................................................... 45

2.7.2 VNFs (Virtualized Network Functions)............................................................................................... 46

2.7.3 NFV-MANO (NFV-Management and Orchestration) ......................................................................... 46

2.7.3.1 VIM (Virtualized Infrastructure Manager) ..................................................................................................... 46

2.7.3.2 Orchestrator.................................................................................................................................................. 46

2.7.3.3 VNF Manager ................................................................................................................................................ 47

2.8 How SDN and NFV Differ from Each Other ................................................................................................... 48

2.8.1 Similarities and Differences ............................................................................................................... 48

2.8.2 Can Both Technologies Complement Each Other? ............................................................................ 49

2.8.3 How Are Vendors Positioning their Solutions?.................................................................................. 49

2.9 Market Drivers............................................................................................................................................... 50

2.9.1 Leveraging Generic Low-cost Hardware ............................................................................................ 50

2.9.2 Multi-tenancy on Same Hardware .................................................................................................... 50

2.9.3 Reduced Power Consumption ........................................................................................................... 50

2.9.4 Faster TTM (Time to Market) ............................................................................................................ 50

2.9.5 Improved Operational Efficiency & Performance ............................................................................. 51

2.9.6 Centralized Provisioning and Network Control ................................................................................. 51

2.9.7 Ability to Launch New Services & Virtual Networks Quickly ............................................................. 51

2.9.8 Dynamic Scaling of Services............................................................................................................... 52

2.9.9 Opening the Door to Multi-vendor Interoperability ......................................................................... 52

2.9.10 CapEx and OpEx Reduction ............................................................................................................... 52

2.9.11 Fast Troubleshooting and Improved Diagnostics .............................................................................. 52

2.9.12 Vendor Support ................................................................................................................................. 52

2.10 Market Barriers .......................................................................................................................................... 53

2.10.1 Lack of Standardization & Technology Maturity ............................................................................... 53

2.10.2 Uncertain Cost-Benefits Tradeoffs .................................................................................................... 53

2.10.3 NFV May Slow/Delay Traffic .............................................................................................................. 53



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2.10.4 Will Multi-vendor Interoperability Really Work? .............................................................................. 54

2.10.5 Co-Existence with Legacy Networks: Integration Challenges ............................................................ 54

3 Chapter 3: SDN/NFV Use Case Scenarios .......................................................... 55

3.1 Enterprise, Data Center & Generic Use Cases ............................................................................................... 55

3.1.1 Network Virtualization ...................................................................................................................... 55

3.1.2 Network Virtualization Case Study: Scalable Data Centers .............................................................. 56

3.1.3 Tap Aggregation ................................................................................................................................ 56

3.1.4 Dynamic WAN Re-Routing ................................................................................................................. 57

3.1.5 Network Exchange: Interconnecting Physical Networks ................................................................... 57

3.1.6 Improved Traffic Engineering ............................................................................................................ 57

3.1.7 Converged Storage ............................................................................................................................ 58

3.2 Service Provider Use Cases ............................................................................................................................ 59

3.2.1 RAN (Radio Access Network) Virtualization ...................................................................................... 59

3.2.2 C-RAN (Cloud RAN) ............................................................................................................................ 60

3.2.3 Wireline Fixed Access Network Virtualization ................................................................................... 61

3.2.4 EPC (Evolved Packet Core)/Mobile Core Virtualization (Including IMS) ............................................ 62

3.2.5 Mobile Backhaul Virtualization ......................................................................................................... 64

3.2.6 CPE/Home Network Environment Virtualization .............................................................................. 64

3.2.7 Service Chaining ................................................................................................................................ 65

3.2.8 SDN/NFV Iaas (Infrastructure as a Service) ....................................................................................... 66

3.2.9 Other VNFs ........................................................................................................................................ 67

3.2.10 VNF Case Study: DPI (Deep Packet Inspection) ................................................................................. 67

3.2.11 VNFaas (Virtual Network Function as a Service) ............................................................................... 67

3.2.12 VNPaaS (Virtual Network Platform as a Service) ............................................................................... 68

3.2.13 Virtualization of CDNs ....................................................................................................................... 68

3.2.14 Bandwidth on Demand ...................................................................................................................... 69

3.2.15 Bandwidth on Demand Case Study: QoS Management for Video .................................................... 69

3.2.16 Packet-Optical Integration................................................................................................................. 70

4 Chapter 4: SDN/NFV Deployment Case Studies ................................................ 71

4.1 Service Provider Deployment Case Studies ................................................................................................... 71



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4.1.1 AT&T .................................................................................................................................................. 71

4.1.2 BT ....................................................................................................................................................... 73

4.1.3 China Mobile ..................................................................................................................................... 74

4.1.4 DT (Deutsche Telekom) ..................................................................................................................... 75

4.1.5 KDDI ................................................................................................................................................... 77

4.1.6 KT (Korea Telecom) ........................................................................................................................... 78

4.1.7 Mobily Saudi Arabia .......................................................................................................................... 79

4.1.8 NAKA Mobile ..................................................................................................................................... 80

4.1.9 NTT Communications ........................................................................................................................ 81

4.1.10 NTT DoCoMo ..................................................................................................................................... 82

4.1.11 PT (Portugal Telecom) /Oi ................................................................................................................. 83

4.1.12 SingTel ............................................................................................................................................... 84

4.1.13 SK Telecom ........................................................................................................................................ 85

4.1.14 SoftBank ............................................................................................................................................ 86

4.1.15 Telekom Austria................................................................................................................................. 87

4.1.16 Telstra ................................................................................................................................................ 88

4.1.17 Telefónica .......................................................................................................................................... 89

4.1.18 Verizon .............................................................................................................................................. 91

4.1.19 Vodafone ........................................................................................................................................... 92

4.2 Enterprise & Data Center Deployment Case Studies .................................................................................... 93

4.2.1 Equinix ............................................................................................................................................... 93

4.2.2 Fidelity Investments .......................................................................................................................... 93

4.2.3 Google ............................................................................................................................................... 94

4.2.4 Kanazawa University Hospital ........................................................................................................... 94

4.2.5 Nippon Express .................................................................................................................................. 95

5 Chapter 5: Industry Roadmap and Value Chain ................................................ 96

5.1 The SDN, NFV & Network Virtualization Value Chain ................................................................................... 96

5.1.1 Silicon & Server OEMs ....................................................................................................................... 97

5.1.2 Pure-play SDN/NFV Specialists .......................................................................................................... 97

5.1.3 Network Infrastructure Vendors ....................................................................................................... 97



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5.1.4 IT Industry Giants .............................................................................................................................. 98

5.1.5 Mobile Infrastructure Vendors .......................................................................................................... 98

5.1.6 BSS/OSS & Software Vendors ............................................................................................................ 98

5.1.7 Enterprises ......................................................................................................................................... 99

5.1.8 Service Providers ............................................................................................................................... 99

5.1.9 Data Center Operators ...................................................................................................................... 99

5.2 The SDN, NFV & Network Virtualization Industry Roadmap: 2015 - 2020 .................................................. 100

5.2.1 Enterprise & Data Center SDN Rollouts: Pre-2015 .......................................................................... 100

5.2.2 NFV Trials and Vendor Consolidation: 2015 - 2017 ......................................................................... 100

5.2.3 Large Scale Proliferation in Service Provider Networks: 2018 - 2020 ............................................. 101

6 Chapter 6: Standardization Bodies & Alliances ............................................... 102

6.1 3GPP (3rd

Generation Partnership Project) ................................................................................................. 102

6.2 ETSI (European Telecommunications Standards Institute) ......................................................................... 102

6.3 Cloud NFV .................................................................................................................................................... 103

6.4 IETF (Internet Engineering Task Force) ........................................................................................................ 103

6.5 IRTF (Internet Research Task Force) ............................................................................................................ 104

6.6 ITU (International Telecommunications Union) .......................................................................................... 105

6.7 MEF (Metro Ethernet Forum) ...................................................................................................................... 105

6.8 ONF (Open Networking Foundation) .......................................................................................................... 106

6.9 OpenDaylight ............................................................................................................................................... 106

6.10 OpenStack Foundation ............................................................................................................................. 107

6.11 ONRC (Open Networking Research Center) and ON.Lab (Open Networking Lab) ................................... 108

6.12 OPNFV (Open Platform for NFV) .............................................................................................................. 109

6.13 OVA (Open Virtualization Alliance) .......................................................................................................... 109

6.14 OMG (Object Management Group) ......................................................................................................... 110

6.15 TM Forum ................................................................................................................................................. 110

6.16 Vendor Led Initiatives & Ecosystem Programs ........................................................................................ 111

6.16.1 CloudBand NFV Ecosystem Program (Alcatel-Lucent Led) .............................................................. 111

6.16.2 Blue Orbit Ecosystem Program (Cyan Led) ...................................................................................... 111

6.16.3 OpenNFV Application Partner Program (HP Led) ............................................................................ 112



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6.16.4 Network Builders Program (Intel Led) ............................................................................................. 112

6.16.5 OpenContrail (Juniper Led).............................................................................................................. 112

6.16.6 FlowForwarding (Infoblox Led) ........................................................................................................ 113

7 Chapter 7: Company Profiles .......................................................................... 114

7.1 6WIND ......................................................................................................................................................... 114

7.2 A10 Networks .............................................................................................................................................. 115

7.3 Accedian Networks ...................................................................................................................................... 116

7.4 Active Broadband Networks ........................................................................................................................ 117

7.5 ADARA Networks ......................................................................................................................................... 118

7.6 Adax ............................................................................................................................................................. 119

7.7 ADLINK Technology ..................................................................................................................................... 120

7.8 ADVA Optical Networking ........................................................................................................................... 121

7.9 Aeroflex (Cobham) ...................................................................................................................................... 122

7.10 Affirmed Networks ................................................................................................................................... 123

7.11 Airvana ..................................................................................................................................................... 124

7.12 Akamai Technologies ............................................................................................................................... 125

7.13 Alcatel-Lucent/Nuage Networks .............................................................................................................. 126

7.14 Altiostar Networks ................................................................................................................................... 127

7.15 Alvarion Technologies .............................................................................................................................. 128

7.16 Allot Communications .............................................................................................................................. 129

7.17 Altera Corporation ................................................................................................................................... 130

7.18 Amartus .................................................................................................................................................... 131

7.19 AMD (Advanced Micro Devices) ............................................................................................................... 132

7.20 Amdocs ..................................................................................................................................................... 133

7.21 Argela (Turk Telekom Subsidiary) ............................................................................................................ 134

7.22 Aricent ...................................................................................................................................................... 135

7.23 Arista Networks ........................................................................................................................................ 136

7.24 ARM Holdings ........................................................................................................................................... 137

7.25 Artesyn Embedded Technologies ............................................................................................................. 138

7.26 ASOCS ....................................................................................................................................................... 139



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7.27 AudioCodes .............................................................................................................................................. 140

7.28 Avaya ........................................................................................................................................................ 141

7.29 Big Switch Networks................................................................................................................................. 142

7.30 Blue Coat .................................................................................................................................................. 143

7.31 Broadcom ................................................................................................................................................. 144

7.32 Brocade/Vyatta ........................................................................................................................................ 145

7.33 Calsoft Labs/ALTEN Group ....................................................................................................................... 146

7.34 Canonical .................................................................................................................................................. 147

7.35 Catbird Networks ..................................................................................................................................... 148

7.36 Cavium...................................................................................................................................................... 149

7.37 Cedexis ..................................................................................................................................................... 150

7.38 Cellwize .................................................................................................................................................... 151

7.39 Centec Networks ...................................................................................................................................... 152

7.40 Ceragon Networks .................................................................................................................................... 153

7.41 Certes Networks ....................................................................................................................................... 154

7.42 Check Point Software Technologies ......................................................................................................... 155

7.43 Ciena ........................................................................................................................................................ 156

7.44 Cisco Systems ........................................................................................................................................... 157

7.45 Citrix Systems ........................................................................................................................................... 158

7.46 Clavister .................................................................................................................................................... 159

7.47 ClearPath Networks ................................................................................................................................. 160

7.48 CloudScaling (EMC Subsidiary) ................................................................................................................. 161

7.49 CohesiveFT ............................................................................................................................................... 162

7.50 Colt ........................................................................................................................................................... 163

7.51 Compass-EOS ........................................................................................................................................... 164

7.52 Comptel .................................................................................................................................................... 165

7.53 Connectem ............................................................................................................................................... 166

7.54 ConteXtream ............................................................................................................................................ 167

7.55 Coriant ...................................................................................................................................................... 168

7.56 Corsa Technology ..................................................................................................................................... 169

7.57 Cumulus Networks ................................................................................................................................... 170



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7.58 Cyan .......................................................................................................................................................... 171

7.59 Dell ........................................................................................................................................................... 172

7.60 Dorado Software ...................................................................................................................................... 174

7.61 Embrane ................................................................................................................................................... 175

7.62 EMC Corporation ...................................................................................................................................... 176

7.63 EnterpriseWeb ......................................................................................................................................... 177

7.64 Ericsson .................................................................................................................................................... 178

7.65 EXFO ......................................................................................................................................................... 180

7.66 Extreme Networks .................................................................................................................................... 181

7.67 EZchip Technologies ................................................................................................................................. 182

7.68 F5 Networks / LineRate Systems .............................................................................................................. 183

7.69 Flash Networks ......................................................................................................................................... 184

7.70 Flextronics ................................................................................................................................................ 185

7.71 Fortinet..................................................................................................................................................... 186

7.72 FRAFOS ..................................................................................................................................................... 187

7.73 Freescale .................................................................................................................................................. 188

7.74 Fujitsu ....................................................................................................................................................... 189

7.75 GENBAND ................................................................................................................................................. 190

7.76 Gencore Systems ...................................................................................................................................... 191

7.77 Gigamon ................................................................................................................................................... 192

7.78 GigaSpaces Technologies ......................................................................................................................... 193

7.79 GoGrid ...................................................................................................................................................... 194

7.80 Guavus ...................................................................................................................................................... 195

7.81 H3C Technologies ..................................................................................................................................... 196

7.82 HP (Hewlett-Packard) ............................................................................................................................... 197

7.83 Hitachi ...................................................................................................................................................... 198

7.84 Huawei ..................................................................................................................................................... 199

7.85 IBM ........................................................................................................................................................... 200

7.86 Infinera ..................................................................................................................................................... 202

7.87 Infoblox .................................................................................................................................................... 203

7.88 Inocybe Technologies ............................................................................................................................... 204



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7.89 Intracom Telecom .................................................................................................................................... 205

7.90 Intel Corporation ...................................................................................................................................... 206

7.91 Intune Networks ...................................................................................................................................... 208

7.92 IP Infusion................................................................................................................................................. 209

7.93 Ipgallery .................................................................................................................................................... 210

7.94 ISC8........................................................................................................................................................... 211

7.95 Itatel ......................................................................................................................................................... 212

7.96 Ixia ............................................................................................................................................................ 213

7.97 JDSU ......................................................................................................................................................... 214

7.98 Juniper Networks ..................................................................................................................................... 215

7.99 KEMP Technologies .................................................................................................................................. 216

7.100 Lancope ................................................................................................................................................ 217

7.101 Lemko .................................................................................................................................................. 218

7.102 Lumeta Corporation ............................................................................................................................. 219

7.103 Luxoft Holding ...................................................................................................................................... 220

7.104 Lyatiss .................................................................................................................................................. 221

7.105 Marvell ................................................................................................................................................. 222

7.106 Mavenir ................................................................................................................................................ 223

7.107 MediaTek ............................................................................................................................................. 224

7.108 Mellanox Technologies ........................................................................................................................ 225

7.109 Metaswitch Networks .......................................................................................................................... 226

7.110 Microsoft ............................................................................................................................................. 227

7.111 Midokura ............................................................................................................................................. 228

7.112 Mirantis ................................................................................................................................................ 229

7.113 Mojatatu Networks .............................................................................................................................. 230

7.114 MRV Communications ......................................................................................................................... 231

7.115 Napatech .............................................................................................................................................. 232

7.116 Nakina Systems .................................................................................................................................... 233

7.117 NCLC (NCL Communication)................................................................................................................. 234

7.118 NEC....................................................................................................................................................... 235

7.119 NetCracker Technology Corp (Part of NEC) ......................................................................................... 236



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7.120 Netgear ................................................................................................................................................ 237

7.121 Netronome .......................................................................................................................................... 238

7.122 Netrounds ............................................................................................................................................ 239

7.123 NetScout Systems ................................................................................................................................ 240

7.124 Netsocket ............................................................................................................................................. 241

7.125 NetYCE ................................................................................................................................................. 243

7.126 Nokia Networks ................................................................................................................................... 244

7.127 Nominum ............................................................................................................................................. 246

7.128 NoviFlow .............................................................................................................................................. 247

7.129 Omnitron Systems ............................................................................................................................... 248

7.130 Openet ................................................................................................................................................. 249

7.131 Openwave Mobility.............................................................................................................................. 250

7.132 Optelian ............................................................................................................................................... 251

7.133 Oracle Corporation .............................................................................................................................. 252

7.134 Orchestral Networks ............................................................................................................................ 254

7.135 Overture Networks .............................................................................................................................. 255

7.136 Pantheon Technologies ....................................................................................................................... 256

7.137 Palo Alto Networks .............................................................................................................................. 257

7.138 PeerApp ............................................................................................................................................... 258

7.139 Pertino ................................................................................................................................................. 259

7.140 Pica8 ..................................................................................................................................................... 260

7.141 Piston Cloud Computing ...................................................................................................................... 261

7.142 Plexxi .................................................................................................................................................... 262

7.143 PLUMgrid ............................................................................................................................................. 263

7.144 Pluribus Networks ................................................................................................................................ 264

7.145 Polaris Networks .................................................................................................................................. 265

7.146 Polatis .................................................................................................................................................. 266

7.147 PowerDNS ............................................................................................................................................ 267

7.148 Procera Networks ................................................................................................................................ 268

7.149 PureWave Networks ............................................................................................................................ 269

7.150 Qosmos ................................................................................................................................................ 270



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7.151 Qualcomm ........................................................................................................................................... 271

7.152 Quobis .................................................................................................................................................. 272

7.153 Quortus ................................................................................................................................................ 273

7.154 Rackspace ............................................................................................................................................ 274

7.155 Radisys Corporation ............................................................................................................................. 275

7.156 Radware ............................................................................................................................................... 276

7.157 RAD Data Communications .................................................................................................................. 277

7.158 Red Bend Software .............................................................................................................................. 278

7.159 Red Hat ................................................................................................................................................ 279

7.160 RightScale............................................................................................................................................. 280

7.161 Riverbed Technology ........................................................................................................................... 281

7.162 Ruckus Wireless ................................................................................................................................... 282

7.163 Saisei Networks .................................................................................................................................... 283

7.164 Sandvine .............................................................................................................................................. 284

7.165 Samsung ............................................................................................................................................... 285

7.166 SanDisk Corporation ............................................................................................................................ 286

7.167 ServiceMesh ......................................................................................................................................... 287

7.168 SevOne ................................................................................................................................................. 288

7.169 Silver Peak Systems .............................................................................................................................. 289

7.170 Skyfire/Opera Software ....................................................................................................................... 290

7.171 Sonus Networks ................................................................................................................................... 291

7.172 SpiderCloud Wireless ........................................................................................................................... 292

7.173 Spirent Communications ..................................................................................................................... 293

7.174 StackIQ ................................................................................................................................................. 294

7.175 SunTech Business Solutions ................................................................................................................. 295

7.176 Svarog Technology Group .................................................................................................................... 296

7.177 Symantec Corporation ......................................................................................................................... 297

7.178 Telchemy .............................................................................................................................................. 298

7.179 Telco Systems ...................................................................................................................................... 299

7.180 Telcoware ............................................................................................................................................ 300

7.181 Telum ................................................................................................................................................... 301



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7.182 Tellabs .................................................................................................................................................. 302

7.183 TI (Texas Instruments) ......................................................................................................................... 303

7.184 Tieto ..................................................................................................................................................... 304

7.185 TorreyPoint .......................................................................................................................................... 305

7.186 Transmode ........................................................................................................................................... 306

7.187 TrendMicro .......................................................................................................................................... 307

7.188 UBIqube Solutions ............................................................................................................................... 308

7.189 vArmour Networks............................................................................................................................... 309

7.190 Vello Systems ....................................................................................................................................... 310

7.191 Versa Networks .................................................................................................................................... 311

7.192 Virtela (NTT Owned) ............................................................................................................................ 312

7.193 VMware/Nicira (EMC Subsidiary) ........................................................................................................ 313

7.194 VSS Monitoring .................................................................................................................................... 314

7.195 WatchGuard Technologies ................................................................................................................... 315

7.196 Wavenet ............................................................................................................................................... 316

7.197 WebNMS (Zoho Corporation) .............................................................................................................. 317

7.198 Websense ............................................................................................................................................ 318

7.199 Wedge Networks ................................................................................................................................. 319

7.200 WiPro ................................................................................................................................................... 320

7.201 Xpliant .................................................................................................................................................. 321

7.202 Zhone Technologies ............................................................................................................................. 322

7.203 ZTE Corporation ................................................................................................................................... 323

7.204 Others .................................................................................................................................................. 324

8 Chapter 8: Market Analysis & Forecasts ......................................................... 326

8.1 Global Outlook of the SDN, NFV & Network Virtualization Market Revenue: 2015 - 2020 ........................ 326

8.2 User Base Segmentation ............................................................................................................................. 327

8.2.1 Data Centers & Enterprises ............................................................................................................. 328

8.2.2 Service Providers ............................................................................................................................. 329

8.3 Submarket Segmentation ............................................................................................................................ 330

8.3.1 SDN Hardware & Software .............................................................................................................. 331



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8.3.2 NFV Hardware & Software .............................................................................................................. 332

8.3.3 Other Network Virtualization Software........................................................................................... 333

8.3.4 Service Provider Submarket Segmentation ..................................................................................... 334

8.4 SDN Submarket Revenue: 2015 – 2020 ....................................................................................................... 335

8.4.1 User Base Segmentation ................................................................................................................. 335

8.4.2 Service Provider SDN ....................................................................................................................... 336

8.4.3 Enterprise & Data Center SDN ......................................................................................................... 337

8.5 NFV Submarket Revenue: 2015 – 2020 ....................................................................................................... 338

8.5.1 Hardware Appliances ...................................................................................................................... 339

8.5.2 Orchestration & Management Software ......................................................................................... 340

8.5.3 VNF Software ................................................................................................................................... 341

8.6 Service Provider SDN Submarket Revenue: 2015 – 2020 ............................................................................ 342

8.6.1 SDN-Enabled Hardware Appliances................................................................................................. 343

8.6.2 Orchestration & Management Software ......................................................................................... 344

8.6.3 SDN Controller Software ................................................................................................................. 345

8.6.4 Network Applications Software ....................................................................................................... 346

8.7 Enterprise/Data Center SDN Submarket Revenue: 2015 – 2020 ................................................................ 347

8.7.1 SDN-Enabled Hardware Appliances................................................................................................. 348

8.7.2 SDN-Enabled Virtual Switches ......................................................................................................... 349

8.7.3 SDN Controller Software ................................................................................................................. 350

8.8 Functional Area Segmentation for Service Provider Deployments ............................................................. 351

8.8.1 Radio Access Networks .................................................................................................................... 352

8.8.2 Mobile Core, EPC, Policy & IMS Services ......................................................................................... 352

8.8.3 OSS/BSS ........................................................................................................................................... 353

8.8.4 Service Provider Data Center .......................................................................................................... 353

8.8.5 Mobile Backhaul .............................................................................................................................. 354

8.8.6 Wireline Fixed Access Networks ...................................................................................................... 354

8.8.7 CPE/Home Environment .................................................................................................................. 355

8.9 Regional Outlook ......................................................................................................................................... 356

8.10 Asia Pacific SDN, NFV & Network Virtualization Revenue: 2015 - 2020 .................................................. 357

8.10.1 Country Level Segmentation ........................................................................................................... 357



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8.10.2 Australia .......................................................................................................................................... 358

8.10.3 China ................................................................................................................................................ 358

8.10.4 India ................................................................................................................................................. 359

8.10.5 Japan................................................................................................................................................ 359

8.10.6 South Korea ..................................................................................................................................... 360

8.10.7 Pakistan ........................................................................................................................................... 360

8.10.8 Thailand ........................................................................................................................................... 361

8.10.9 Indonesia ......................................................................................................................................... 361

8.10.10 Malaysia .......................................................................................................................................... 362

8.10.11 Taiwan ............................................................................................................................................. 362

8.10.12 Philippines ....................................................................................................................................... 363

8.10.13 Singapore ......................................................................................................................................... 363

8.10.14 Rest of Asia Pacific ........................................................................................................................... 364

8.11 Eastern Europe SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ............................................ 365


8.11.2 Czech Republic ................................................................................................................................. 366

8.11.3 Poland .............................................................................................................................................. 366

8.11.4 Russia ............................................................................................................................................... 367

8.11.5 Rest of Eastern Europe .................................................................................................................... 367

8.12 Latin & Central America SDN, NFV & Network Virtualization Revenue: 2015 - 2020 .............................. 368


8.12.2 Argentina ......................................................................................................................................... 369

8.12.3 Brazil ................................................................................................................................................ 369

8.12.4 Mexico ............................................................................................................................................. 370

8.12.5 Rest of Latin & Central America ...................................................................................................... 370

8.13 Middle East & Africa SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ................................... 371


8.13.2 South Africa ..................................................................................................................................... 372

8.13.3 UAE .................................................................................................................................................. 372

8.13.4 Qatar ................................................................................................................................................ 373

8.13.5 Saudi Arabia ..................................................................................................................................... 373



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8.13.6 Israel ................................................................................................................................................ 374

8.13.7 Rest of the Middle East & Africa...................................................................................................... 374

8.14 North America SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ............................................. 375


8.14.2 USA .................................................................................................................................................. 376

8.14.3 Canada ............................................................................................................................................. 376

8.15 Western Europe SDN, NFV & Network Virtualization Revenue: 2015 - 2020 .......................................... 377


8.15.2 Denmark .......................................................................................................................................... 378

8.15.3 Finland ............................................................................................................................................. 378

8.15.4 France .............................................................................................................................................. 379

8.15.5 Germany .......................................................................................................................................... 379

8.15.6 Italy .................................................................................................................................................. 380

8.15.7 Spain ................................................................................................................................................ 380

8.15.8 Sweden ............................................................................................................................................ 381

8.15.9 Norway ............................................................................................................................................ 381

8.15.10 UK .................................................................................................................................................... 382

8.15.11 Rest of Western Europe .................................................................................................................. 382

9 Chapter 9: Conclusion & Strategic Recommendations .................................... 383

9.1 Will SDN & NFV Disrupt the Network Infrastructure Value Chain? ............................................................. 383

9.2 Is There a Ring Leader in the SDN & NFV Ecosystem? ................................................................................ 384

9.3 SDN & NFV: Building the Mobile Cloud ....................................................................................................... 384

9.4 Buyers Will Maintain Focus on Business Agility & CapEx Reduction ........................................................... 385

9.5 Avoiding the Proprietary Trap ..................................................................................................................... 385

9.6 Will Service Providers Continue to Utilize Proprietary Hardware Platforms?............................................. 386

9.7 Making the VoLTE and RCS Business Case Work ......................................................................................... 386

9.8 How Much CapEx Can Service Providers Save with SDN & NFV Investments? ........................................... 387

9.9 Prospects of SDN & NFV Orchestration ....................................................................................................... 388

9.9.1 Different Vendors, Different Approaches ....................................................................................... 389

9.9.2 Future Prospects of Harmonization ................................................................................................ 390



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9.9.3 How Big is the Orchestration Opportunity? .................................................................................... 390

9.10 Strategic Recommendations .................................................................................................................... 391

9.10.1 Recommendations for Silicon & Server OEMs ................................................................................ 391

9.10.2 Recommendations for Network & Mobile Infrastructure Vendors & IT Giants .............................. 391

9.10.3 Recommendations for Pure-play SDN/NFV Specialists ................................................................... 391

9.10.4 Recommendations for Enterprises and Data Center Operators ..................................................... 392

9.10.5 Recommendations for Service Providers ........................................................................................ 392

List of Figures

Figure 1: The NFV Concept ...................................................................................................................................................................................... 43

Figure 2: A Comparison of SDN and NFV ................................................................................................................................................................. 48

Figure 3: C-RAN Architecture................................................................................................................................................................................... 60

Figure 4: Virtualized and Non-Virtualized Mobile Core Networks ........................................................................................................................... 63

Figure 5: The SDN, NFV & Network Virtualization Value Chain ............................................................................................................................... 96

Figure 6: The SDN, NFV & Network Virtualization Industry Roadmap: 2015 - 2020 .............................................................................................. 100

Figure 7: Global SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ........................................................................................ 326

Figure 8: Global SDN, NFV & Network Virtualization Revenue by User Base: 2015 - 2020 ($ Million)................................................................... 327

Figure 9: Global Data Center/Enterprise SDN & Network Virtualization Revenue: 2015 - 2020 ($ Million) .......................................................... 328

Figure 10: Global Service Provider SDN & NFV Revenue by User Base: 2015 - 2020 ($ Million) ............................................................................ 329

Figure 11: Global SDN, NFV & Network Virtualization Revenue by Submarket: 2015 - 2020 ($ Million) ............................................................... 330

Figure 12: Global SDN Hardware & Software Revenue: 2015 - 2020 ($ Million) ................................................................................................... 331

Figure 13: Global NFV Hardware & Software Revenue: 2015 - 2020 ($ Million).................................................................................................... 332

Figure 14: Global Other Network Virtualization Software Revenue: 2015 - 2020 ($ Million) ................................................................................ 333

Figure 15: Global Service Provider SDN & NFV Revenue by Submarket: 2015 - 2020 ($ Million) .......................................................................... 334

Figure 16: Global SDN Revenue by User Base: 2015 - 2020 ($ Million) ................................................................................................................. 335

Figure 17: Global Service Provider SDN Hardware & Software Revenue: 2015 - 2020 ($ Million) ......................................................................... 336

Figure 18: Global Enterprise/Data Center SDN Revenue: 2015 - 2020 ($ Million) ................................................................................................. 337

Figure 19: Global NFV Revenue by Submarket: 2015 - 2020 ($ Million) ................................................................................................................ 338

Figure 20: Global NFV Hardware Appliance Revenue: 2015 - 2020 ($ Million) ...................................................................................................... 339

Figure 21: Global NFV Orchestration & Management Software Revenue: 2015 - 2020 ($ Million) ....................................................................... 340

Figure 22: Global NFV VNF Software Revenue: 2015 - 2020 ($ Million) ................................................................................................................ 341

Figure 23: Global Service Provider SDN Revenue by Submarket: 2015 - 2020 ($ Million) ..................................................................................... 342

Figure 24: Global Service Provider SDN-Enabled Hardware Appliance Revenue: 2015 - 2020 ($ Million) ............................................................. 343

Figure 25: Global Service Provider SDN Orchestration & Management Revenue: 2015 - 2020 ($ Million) ........................................................... 344

Figure 26: Global Service Provider SDN Controller Software Revenue: 2015 - 2020 ($ Million) ............................................................................ 345

Figure 27: Global Service Provider SDN Network Applications Software Revenue: 2015 - 2020 ($ Million) .......................................................... 346

Figure 28: Global Enterprise/Data Center SDN Revenue by Submarket: 2015 - 2020 ($ Million) .......................................................................... 347



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Figure 29: Global Enterprise/Data Center SDN-Enabled Hardware Appliance Revenue: 2015 - 2020 ($ Million) .................................................. 348

Figure 30: Global Enterprise/Data Center SDN-Enabled Hardware Appliance Revenue: 2015 - 2020 ($ Million) .................................................. 349

Figure 31: Global Enterprise/Data Center SDN Controller Software Revenue: 2015 - 2020 ($ Million) ................................................................. 350

Figure 32: Global Service Provider SDN & NFV Revenue by Functional Area: 2015 - 2020 ($ Million) .................................................................. 351

Figure 33: Global Radio Access Networks SDN & NFV Revenue: 2015 - 2020 ($ Million) ...................................................................................... 352

Figure 34: Global Mobile Core, EPC, Policy & IMS Services SDN & NFV Revenue: 2015 - 2020 ($ Million) ............................................................ 352

Figure 35: Global OSS/BSS SDN & NFV Revenue: 2015 - 2020 ($ Million) ............................................................................................................. 353

Figure 36: Global Service Provider Data Center SDN & NFV Revenue: 2015 - 2020 ($ Million) ............................................................................. 353

Figure 37: Global Mobile Backhaul SDN & NFV Revenue: 2015 - 2020 ($ Million) ................................................................................................ 354

Figure 38: Global Wireline Fixed Access Networks SDN & NFV Revenue: 2015 - 2020 ($ Million) ........................................................................ 354

Figure 39: Global CPE/Home Environment SDN & NFV Revenue: 2015 - 2020 ($ Million) .................................................................................... 355

Figure 40: SDN, NFV & Network Virtualization Revenue by Region: 2015 - 2020 ($ Million) ................................................................................ 356

Figure 41: Asia Pacific SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) .............................................................................. 357

Figure 42: Asia Pacific SDN, NFV & Network Virtualization Revenue by Country: 2015 - 2020 ($ Million) ............................................................ 357

Figure 43: Australia SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) .................................................................................. 358

Figure 44: China SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ....................................................................................... 358

Figure 45: India SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ........................................................................................ 359

Figure 46: Japan SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ....................................................................................... 359

Figure 47: South Korea SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ............................................................................. 360

Figure 48: Pakistan SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ................................................................................... 360

Figure 49: Thailand SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ................................................................................... 361

Figure 50: Indonesia SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ................................................................................. 361

Figure 51: Malaysia SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) .................................................................................. 362

Figure 52: Taiwan SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ..................................................................................... 362

Figure 53: Philippines SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ............................................................................... 363

Figure 54: Singapore SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ................................................................................ 363

Figure 55: SDN, NFV & Network Virtualization Revenue in the Rest of Asia Pacific: 2015 - 2020 ($ Million) ........................................................ 364

Figure 56: Eastern Europe SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ........................................................................ 365

Figure 57: Eastern Europe SDN, NFV & Network Virtualization Revenue by Country: 2015 - 2020 ($ Million)...................................................... 365

Figure 58: Czech Republic SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ........................................................................ 366

Figure 59: Poland SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ..................................................................................... 366

Figure 60: Russia SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ...................................................................................... 367

Figure 61: SDN, NFV & Network Virtualization Revenue in the Rest of Eastern Europe: 2015 - 2020 ($ Million) .................................................. 367

Figure 62: Latin & Central America SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) .......................................................... 368

Figure 63: Latin & Central America SDN, NFV & Network Virtualization Revenue by Country: 2015 - 2020 ($ Million) ........................................ 368

Figure 64: Argentina SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ................................................................................. 369

Figure 65: Brazil SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million)........................................................................................ 369

Figure 66: Mexico SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million)..................................................................................... 370

Figure 67: SDN, NFV & Network Virtualization Revenue in the Rest of Latin & Central America: 2015 - 2020 ($ Million) .................................... 370

Figure 68: Middle East & Africa SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ................................................................ 371

Figure 69: Middle East & Africa SDN, NFV & Network Virtualization Revenue by Country: 2015 - 2020 ($ Million) ............................................. 371

Figure 70: South Africa SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ............................................................................. 372



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Figure 71: UAE SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million).......................................................................................... 372

Figure 72: Qatar SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ....................................................................................... 373

Figure 73: Saudi Arabia SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ............................................................................ 373

Figure 74: Israel SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ........................................................................................ 374

Figure 75: SDN, NFV & Network Virtualization Revenue in the Rest of the Middle East & Africa: 2015 - 2020 ($ Million) ................................... 374

Figure 76: North America SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ......................................................................... 375

Figure 77: North America SDN, NFV & Network Virtualization Revenue by Country: 2015 - 2020 ($ Million) ...................................................... 375

Figure 78: USA SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) .......................................................................................... 376

Figure 79: Canada SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) .................................................................................... 376

Figure 80: Western Europe SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ...................................................................... 377

Figure 81: Western Europe SDN, NFV & Network Virtualization Revenue by Country: 2015 - 2020 ($ Million) .................................................... 377

Figure 82: Denmark SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) .................................................................................. 378

Figure 83: Finland SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) .................................................................................... 378

Figure 84: France SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ..................................................................................... 379

Figure 85: Germany SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) .................................................................................. 379

Figure 86: Italy SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ......................................................................................... 380

Figure 87: Spain SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million)........................................................................................ 380

Figure 88: Sweden SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) .................................................................................... 381

Figure 89: Norway SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) .................................................................................... 381

Figure 90: UK SDN, NFV & Network Virtualization Revenue: 2015 - 2020 ($ Million) ............................................................................................ 382

Figure 91: SDN, NFV & Network Virtualization Revenue in the Rest of Western Europe: 2015 - 2020 ($ Million) ................................................ 382

Figure 92: SDN & NFV Induced Service Provider CapEx Saving Potential by Region: 2015 - 2020 ($ Million) ........................................................ 387

Figure 93: Orchestration as a Percentage of Service Provider SDN & NFV Spending: 2015 – 2020 (%) ................................................................. 388

Figure 94: Management & Orchestration Software Revenue by Submarket: 2015 - 2020 ($ Million)................................................................... 390



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1 Chapter 1: Introduction

1.1 Executive Summary

SDN (Software Defined Networking) is new networking model where control of

the network is decoupled from the physical hardware allowing a logically

centralized software program to control the behavior of an entire network. This

results in reduced reliance on proprietary networking hardware, increased

network efficiency, centralized traffic engineering, faster time to troubleshooting

and new feature deployment. SDN also complements network virtualization by

facilitating the creation of multiple virtual networks running over a common

physical network fabric.

NFV (Network functions virtualization) is a service provider initiative that is often

linked to SDN. NFV aims to virtualize and effectively consolidate many network

equipment types onto multi-tenant industry-standard servers, switches and

storage to lower cost, improve efficiency and increase agility.

While the benefits of SDN and network virtualization are well known in the

enterprise IT and data center world, both technologies also bring a hosts of

benefits to the telecommunications service provider/carrier community.

Not only can SDN and NFV help address the explosive capacity demand of mobile

traffic, but they can also reduce the CapEx and OpEx burden faced by service

providers to handle this demand by diminishing reliance on expensive proprietary

hardware platforms.



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SDN has been widely deployed in data center and enterprise environments, and

many service provider deployments are already underway. While NFV is still a

developing technology, many vendors have already developed commercial-grade

solutions that align well with the NFV initiative.

Driven by the thriving ecosystem, SNS Research estimates that the SDN, NFV and

network virtualization market will account for nearly $10 Billion in 2015 alone.

Despite barriers relating to standardization and co-existence with legacy

networks, SNS Research estimates further growth at a CAGR of 37% over the next

5 years.

This report presents an in-depth assessment of the global SDN, NFV and network

virtualization market. In addition to covering underlying technology, key market

drivers, challenges, future roadmap, value chain analysis, deployment case

studies, company profiles, product strategies and strategic recommendations, the

report also presents comprehensive forecasts for the market from 2015 till 2020.

The forecasts are individually segmented for 10 individual submarkets, 2 user base

categories, 7 use case categories, 6 geographical regions and 34 countries.

The report comes with an associated Excel datasheet covering quantitative data

from all figures presented within the report.



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1.2 Topics Covered

The report covers the following topics:

The scope and implementation of SDN, NFV and network virtualization

across the globe

SDN, NFV and network virtualization technology

Market drivers and key benefits of SDN, NFV and network virtualization

Challenges and inhibitors to the ecosystem

Standardization and regulatory initiatives

Use cases and application case studies of SDN and NFV

SDN and NFV deployment case studies

SDN and NFV induced service provider CapEx savings

Value chain analysis of the ecosystem and the recognition of key players

in each segment of the value chain

Industry roadmap from 2015 till 2020

Key trends in the ecosystem; SDN and NFV’s impact on the network

infrastructure value chain, prospects of orchestration platforms, the

stance of incumbent vendors towards SDN and NFV, impact on the

proprietary hardware market and co-existence with legacy networks

Profiles and strategies of over 200 key players in the ecosystem

Strategic recommendations for silicon & server OEMs, network & mobile

Infrastructure vendors, IT giants, pure-play SDN/NFV specialists,

enterprises, data center operators and service providers

Historical revenue figures and forecasts till 2020



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1.3 Forecast Segmentation

Market forecasts are provided for each of the following submarkets, use

base and use case categories:

- Submarkets

SDN Hardware & Software

NFV Hardware & Software

Other Network Virtualization Software

- User Base Categories

Service Providers

Data Centers & Enterprises

- NFV Submarkets

Hardware Appliances

Orchestration & Management Software

VNF Software

- Service Provider SDN Submarkets

SDN-Enabled Hardware Appliances

Orchestration & Management Software

SDN Controller Software

Network Applications Software

- Data Center/Enterprise SDN Submarkets

SDN-Enabled Hardware Appliances

SDN-Enabled Virtual Switches

SDN Controller Software

- Service Provider Use Case Categories

Radio Access Networks

Mobile Core, EPC, Policy & IMS Services



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OSS/BSS

Data Center

Mobile Backhaul

Wireline Fixed Access Networks

CPE/Home Environment

The following regional and country markets are also covered:

- Regional Markets

Asia Pacific

Eastern Europe

Latin & Central America

Middle East & Africa

North America

Western Europe

- Country Markets

Argentina, Australia, Brazil, Canada, China, Czech

Republic, Denmark, Finland, France, Germany, India,

Indonesia, Israel, Italy, Japan, Malaysia, Mexico, Norway,

Pakistan, Philippines, Poland, Qatar, Russia, Saudi Arabia,

Singapore, South Africa, South Korea, Spain, Sweden,

Taiwan, Thailand, UAE, UK, USA

Additional forecasts are provided for:

SDN and NFV Induced Service Provider CapEx Savings by

Region



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1.4 Key Questions Answered

The report provides answers to the following key questions:

What are the key market drivers and challenges for SDN, NFV and the

wider network virtualization ecosystem?

How can SDN and NFV complement each other?

What are the key applications and use cases of SDN and NFV?

How is the SDN, NFV and network virtualization value chain structured

and how will it evolve overtime?

What opportunities do SDN and NFV offer to silicon & server OEMs,

network & mobile Infrastructure vendors, IT giants, pure-play SDN/NFV

specialists, enterprises, data center operators and service providers and

other players in the value chain?

What strategies should these players adopt to capitalize on the SDN and

NFV opportunity?

How are SDN and NFV vendors positioning their product offerings?

How big is the SDN, NFV and network virtualization ecosystem, and how

much revenue will it generate in 2020?

What particular submarkets does the ecosystem constitute?

What geographical regions, countries and submarkets offer the greatest

growth potential for SDN and NFV investments?

Who are the key players in the SDN and NFV ecosystem and what are

their strategies?



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How will SDN and NFV impact the network infrastructure value chain?

Is there a ring leader in the SDN and NFV ecosystem?

How long will service providers continue to utilize proprietary hardware

platforms?

How can SDN and NFV help make the VoLTE (Voice over LTE) and RCS

(Rich Communication Services) business case work?

How can software-defined DPI (Deep Packet Inspection) complement SDN

functionality?

What level of CapEx savings can SDN and NFV facilitate for service

providers in each region?



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1.5 Key Findings

The report has the following key findings:

Driven by the thriving ecosystem, SNS Research estimates that the SDN,

NFV and network virtualization market will account for nearly $10 Billion

in 2015 alone. SNS Research estimates further growth at a CAGR of 37%

over the next 6 years

Spending on SDN/NFV orchestration platforms is expected to grow at a

CAGR of nearly 60% between 2015 and 2020. By the end of 2020,

orchestration platforms will account for $1.7 Billion in revenue,

representing more than 8% of all service provider SDN/NFV spending

Although network virtualization in the enterprise IT and data center

domain has received significant attention in the past years, service

provider network virtualization is still at a nascent stage

SDN and NFV empower a multitude of network functions to be

implemented cost effectively in software, ranging from standard mobile

IMS (IP Multimedia System) services to features such as DPI (Deep Packet

Inspection)

By 2017 we expect to see significant price and gross margin erosion for

traditional hardware-based network switching equipment driven by

alternative software based solutions

By 2020 SNS Research estimates that SDN and NFV can enable service

providers (both wireline and wireless) to save up to $32 Billion in annual

CapEx investments



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1.6 Methodology

The contents of this report have been accumulated by combining information

attained from a range of primary and secondary research sources. In addition to

analyzing official corporate announcements, policy documents, media reports,

and industry statements, SNS Research sought opinions from leading industry

players within the SDN, NFV and network virtualization market to derive an

unbiased, accurate and objective mix of market trends, forecasts and the future

prospects of the industry between 2015 and 2020.



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1.7 Target Audience

The report targets the following audience.

Silicon and server OEMs

SDN, NFV and network virtualization solution providers

Network Infrastructure vendors

Mobile network infrastructure vendors

IT industry giants

BSS/OSS & software vendors

Enterprises

Data center operators

Telecommunication service providers

Application developers & integrators

Investment firms



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1.8 Companies & Organizations Mentioned

The following companies and organizations have been reviewed, discussed or

mentioned in the report:

21 Vianet Group DT (Deutsche Telekom) MediaTek Ruckus Wireless

3GPP (3rd Generation Partnership Project)

ECI Telecom MEF (Metro Ethernet Forum)

Saisei Networks

6connect Ecode Networks Mellanox Technologies Samsung

6WIND Edgenet Mentor Graphics Sanctum Networks

A10 Networks Edgewater Networks Metaswitch Networks SanDisk Corporation

Accedian Networks Elbrys Networks MetraTech Corporation

Sandvine

Accton Elisa Oyj Microsoft Scalr

Acme Packet Embrane Midokura SCLID Innovations

ActionPacked Networks EMC Corporation Mirantis SDNSquare

Active Broadband Networks

Emerson Network Power MKI USA ServiceMesh

ADARA Networks Emulex Mobily Saudi Arabia Seven Principles

Adax Enterasys Networks Mojatatu Networks SevOne

ADLINK Technology EnterpriseWeb MontaVista Sharp

ADTRAN Equinix Motorola Mobility Shenick Network Systems

ADVA Optical Networking Ericsson MRV Communications Sichuan Unicom

Advantech EstiNet Technologies Mtel Silver Peak Systems

AEPONYX ETRI (Electronics and Telecommunications Research Institute)

NAKA Mobile SingTel (Singapore Telecommunications Limited)

Aeroflex ETSI (European Telecommunications Standards Institute)

Nakina Systems SK Telecom

Affirmed Networks EXFO Napatech Skyfire

Airvana Extreme Networks Nari Networks Snabb

Akamai Technologies EZchip Narinet SoftBank

Alcatel-Lucent EZchip Technologies NASA ( National Aeronautics and Space Administration)

Solarflare Communications



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Algar Telecom F5 Networks NCLC (NCL Communication)

SolarWinds

Alibaba Facebook Nebula SolidFire

Allot Communications Fiberhome Technologies NEC SonicWALL

Altaro Fidelity Investments Nephos6 Sonus Networks

ALTEN Group Firemon Net Optics SpiderCloud Wireless

Altera Corporation Fishnet Security NetApp Spirent Communications

Altiostar Networks Flanagan Consulting NetCracker Technology Corporation

Splunk

Alvarion Technologies Flash Networks NetFlow Logic Sprint Corporation

Amartus Flextronics Netgear StackIQ

Amazon Force10 Networks NetNumber Stanford University

AMD (Advanced Micro Devices)

Fortinet Netronome Stateless Networks

Amdocs FRAFOS Netrounds Stork Lab

Amethon Fraunhofer FOKUS NetScout Systems Stratosphere

Anuta Networks Freescale Netsocket Sunbay

Apple FTW - Telecommunications Research Centre Vienna

NetStructures SunTech Business Solutions

Argela Fujian Telecom NetYCE Super Micro

Aricent Group Fujitsu NICE Svarog Technology Group

Arista Networks GE Intelligent Platforms (GE Energy)

Nicira Swisscom

ARM Holdings Gemtek Technologies Nicira Symantec Corporation

Arnold Consulting GENBAND Nippon Express SYS Software

Artesyn Embedded Technologies

Gencore Systems Nissho Electronics Tail-f Systems

Aruba Networks Gigamon Nokia Tallac Networks

ASOCS GigaSpaces Technologies Nokia Networks Tata Consultancy Services

AT&T GlimmerGlass Nominum Tech Mahindra

aTAC Initiatives Glue Networks NoviFlow Tekelec

AudioCodes GoGrid NTT Communications Tektronix

Avago Technologies Goldman Sachs NTT Corporation Telchemy



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Avaya Google NTT Data Telco Systems

Beijing Telecom Guavus NTT DoCoMo Telcoware

Bell Canada H3C Technologies Nuage Networks Telecom Italia

Benu Networks Hitachi Nuage Networks Telefónica

Big Switch Networks Hitachi CTA (Hitachi Communication Technologies America)

Nutanix Telekom Austria

BII (Beijing Internet Institute)

HP (Hewlett-Packard) OMG (Object Management Group)

TeliaSonera

BII Group Hrvatski Telekom Omnitron Systems Tellabs

Blue Coat HTC ON.Lab (Open Networking Lab)

Telstra

Boundary Huawei One Convergence Telum

Broadcom IBM ONF (Open Networking Foundation)

Telus

Brocade IBS Group ONRC (Open Networking Research Center)

Tencent

Browan Communications iCent OpenDaylight Tervela

BSkyB IETF (Internet Engineering Task Force)

Openet Thales

BT III (Institute for Information Industry)

OpenStack Foundation The Gap

BTI Systems Indiana University Openwave Mobility TI (Texas Instruments)

CableLabs IneoQuest Technologies Opera Software Tieto

Calient Technologies Infinera Opera Software Tilera Corporation

Calsoft Labs Infinetics OPNFV (Open Platform for NFV)

TM Forum

Canonical Infoblox Opscode T-Mobile

Cariden Technologies Inktank Optelian TorreyPoint

Carmel Ventures Inocybe Technologies Optus Transmode

Catbird Networks INRIA (French Institute for Research in Computer Science)

Oracle Corporation Travelping GmbH

Cavium Networks Insieme Networks Orange TrendMicro

Cedexis Intel Corporation Orchestral Networks Tucana

Celestica Interphase Orient Logic Turk Telekom

Cellcom Intracom Telecom OVA (Open Virtualization Alliance)

Turk Telekom



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Cellwize Intune Networks Overture Networks TW Telecom

Centec Networks IP Infusion PacketFront Software Ubicity Corporation

CenturyLink Corporation Ipgallery Pacnet UBIqube Solutions

Ceragon Networks IRTF (Internet Research Task Force)

Palo Alto Networks United Nations

Certes Networks ISC8 Pantheon Technologies

University of California, Berkeley

Cetan Corporation Iskratel Paxterra Solutions UPRC

Check Point Software Technologies

Italtel PayPal vArmour Networks

China Mobile ITU (International Telecommunications Union)

PeakColo Vello Systems

China Telecom Ixia PeerApp Verisign

ChipStart Jara Networks Pertino Verizon Communications

Ciena JDSU Phillips Technology Solutions

Verizon Wireless

CIMI Corporation JumpGen Systems Pica8 Versa Networks

Cisco Systems Juniper Networks Piston Cloud Computing

Veryx Technologies

Cisco WebEx Kanazawa University Hospital

Pivotal Vipnet

Citrix Systems KDDI Plexxi Virtela

Clavister KEMP Technologies PLUMgrid Virtela (NTT Owned)

ClearPath Networks Kloudspun Pluribus Networks Virtual Open Systems

CloudFX KT (Korea Telecom) PLVision VirtualLogix

CloudNFV Kulcloud PMC Sierra Visionael Corporation

Cloudscaling Kyocera Polaris Networks VMware

CloudSense L3 Communication Systems – East

Polatis Vodafone

CMRI (China Mobile Research Institute)

Lagrange Systems PowerDNS VSS Monitoring

Cobham Lancope Poznan Supercomputing and Network Centre

Vyatta

CohesiveFT Lanner Procera Networks Vyatta

Colt Lanscope PT (Performance Technologies)

WatchGuard Technologies

Comcast Layer123 PT (Portugal Telecom) /Oi

Wavenet



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Compass-EOS Lemko PureWave Networks WebNMS

Comptel Level 3 Communications Qosmos Websense

Connectem LG Electronics Qualcomm Wedge Networks

ConteXtream LineRate Systems Quanta Wind River Systems

Contrail Systems Linux Foundation Quobis Windstream Communications

Coraid Locaweb Quortus WiPro

Coriant LSI Corporation Rabobank Wiretap

Corsa Technology Lumeta Corporation Rackspace WVNET

Cplane Luxoft Holding RAD Data Communications

xFlow Research

CSC (Computer Sciences Corporation)

Lyatiss RadiSys Corporation XIUS

Cumulus Networks M2Mi Radware Xpliant

Cyan Macnica Networks Real Status Xsigo

Dell Mainline Information Systems

Red Bend Software Yahoo

Delta Electronics Marist College Red Hat Yokogawa

DESS GmbH and Co. Consulting

Marvell RightScale Zhone Technologies

Dialogic Mavenir Riverbed Technology Zoho Corporation

DirecTV McAfee Rogers Communications

ZTE Corporation

Dorado Software MeadowCom RuahTao



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Copyright SNS Research Ltd, 2014. All rights reserved.

This material is subject to the laws of copyright and is restricted to registered

license-holders who have entered into a Corporate, a Multi-User or a Single-User

license agreement with SNS Research Ltd. It is an offence for the license-holder to

make the material available to any unauthorized person, either via e-mail

messaging or by placing it on a network.

All SNS research reports & databases are intended to provide general information

and strategic insights only, and they do not constitute, nor are they intended to

constitute, investment advice. SNS Research and its employees disclaim all and

any guarantees, undertakings and warranties, whether expressed or implied, and

shall not be liable for any loss or damage whatsoever, and whether foreseeable

or not, arising out of, or in connection with, any use of or reliance on any

information, statements, opinions, estimates or forecasts contained in the

reports.



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2.8 How SDN and NFV Differ from Each Other

2.8.1 Similarities and Differences

Both SDN and NFV are focused on making networking services easier to deploy,

manage and scale while driving down the costs.

SDN NFV

Aim Separation of control and data

planes to centralize the control and

programmability of network

Replace network functions from

dedicated appliances with

software that can run on generic

servers

Initial Target Market Enterprise IT infrastructure & data

centers

Service provider networks

Target Devices Industry standard servers or

switches

Industry standard servers or

switches

Key Benefits Increase agility and drive down cost

and complexity

Increase agility and drive down

cost and complexity

Figure 2: A Comparison of SDN and NFV

Source: SNS Research

The key difference is that SDN aims to split control and data planes of the

networking environment, while NFV aims to replace network functions with

software. Both approaches also focus on replacing proprietary purpose-built



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3.2.2 C-RAN (Cloud RAN)

Leveraging RAN virtualization technology as described in Section 3.2.1 also opens

the doors for the C-RAN concept.

Figure 3: C-RAN Architecture


In a traditional RAN architecture, each antenna connects to a co-located base

station from which traffic is backhauled to the core. In a C-RAN setup, the base

station at the antenna is replaced by a low-cost RRH (Remote Radio Head). The

digitized RF data is then transported typically via a CPRI (Common Public Radio

Distributed RRHs (Remote Radio

Heads)

Fronthaul Transport Network

Link

BBU (Baseband Units) Cloud for

Centralized Processing



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4.1.10 NTT DoCoMo

Like its fixed line business, NTT’s mobile subsidiary NTT DoCoMo is a taking an

aggressive first mover stance to capitalize on SDN and NFV. The carrier views both

technologies as a means to help reduce CapEx, avoid vendor lock-in, improve

traffic control and increase network availability. Besides being a leading

participant in the ETSI NFV industry specifications group, NTT DoCoMo is also one

of the founding members of the OPNFV (Open Platform for NFV) project, aimed to

support the development of an open-source platform for virtualization.

Trials & PoC Activity

In Q4’2014, NTT DoCoMo completed NFV PoC (Proof-of-Concept) trials using

software and infrastructure from six vendors including Alcatel-Lucent, Cisco,

Ericsson, Huawei, NEC, and Nokia Networks. Using these trials, the carrier

successfully verified the interoperability of each vendor's vEPC (virtualized EPC)

software with a different vendor’s orchestration platform in various scenarios,

such as scalable data processing capability for congested data traffic and

immediate network recovery in the event of hardware failure.

Deployment Timelines

NTT DoCoMo plans to virtualize its EPC in time to have commercial services

running over it by the end of March 2016, a timeframe the carrier has reiterated

several times. The carrier has not yet revealed a timeline for virtualizing other5

parts (such as RAN) of its network.

5 NTT DoCoMo plans to deploy a 5G network in time for the 2020 Tokyo Olympics. Prior to this deployment, we

expect the carrier to virtualize a significant proportion of its network.



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5 Chapter 5: Industry Roadmap and Value Chain

This chapter reviews the industry roadmap and value chain for the SDN, NFV and

network virtualization ecosystem.

5.1 The SDN, NFV & Network Virtualization Value Chain

The SDN, NFV and network virtualization value chain encompasses 9 major

segments which work in conjunction to create an ecosystem of applications;

silicon and server OEMs, pure-play SDN/NFV specialists, network infrastructure

vendors, IT industry giants, mobile infrastructure vendors, BSS/OSS & software

vendors, enterprises, service providers and data center operators.

Figure 5: The SDN, NFV & Network Virtualization Value Chain


End User Ecosystem

Network

Infrastructure

Vendors

Mobile

Infrastructure

Vendors

IT Industry

Giants

Pure-play SDN/NFV Specialists

Enterprises

Service

Providers

Data Center

Operators

Silicon &

Server OEMs

Technology Distribution Ecosystem

BSS/OSS/Software

Vendors

Enabler Ecosystem



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7.53 Connectem Connectem is a company focused on the virtualization of the mobile packet core.

Founded in 2011, the company is headquartered in San Jose, California.

Connectem has developed one of the first ever instances of an LTE vEPC, with

architectural attributes to support deployment over standard data center

infrastructure. Marketed as the VCM (Virtual Core for Mobile) platform, the

company’s vEPC solution delivers bespoke mobile packet core functionality as a

set of software services running over low cost x86 servers and standard hypervisor

technology.

In Q4’2012, Connectem became the first company to announce a trial vEPC

deployment in a production network environment with Optus in Australia. Since

then, Connectem has conducted deployments with numerous operators including

Telekom Austria7.

In terms of industry alliances, Connectem collaborates with a number of

prominent players in the NFV ecosystem including Amdocs, Amethon, Clavister,

Cyan, IBM8, Intel, Procera Networks, Red Hat and VMware9. The company also

7 In Q2’2014, Telekom Austria’s Croatian mobile network operator subsidiary Vipnet deployed Connectem’s VCM

vEPC platform, as part of an initiative to test and evaluate NFV. Vipnet also showcased live transmission of HD video on its LTE network with a data transfer speed of nearly 100 Mbps through Connectem's vEPC. 8 Although Connectem’s VCM platform can leverage the entire x86 ecosystem, its first demonstration (with Optus

in Q4’2012) utilized the IBM PureFlex platform. 9 As part of its partnership with VMware, Connectem utilizes the VMware vSphere virtualization platform and the

VMware ESXi hypervisor.



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7.84 Huawei Huawei is a Chinese multinational networking and telecommunications equipment

and services company headquartered in Shenzhen, China. As one of the largest

telecommunications equipment maker in the world, it is a major proponent of

SDN and NFV.

While targeting both service provider and enterprise/data center customers,

Huawei is particularly keen to virtualize its mobile network infrastructure offerings

as its service provider customers seek to transition to an SDN/NFV centric

architecture. The company now boasts a comprehensive portfolio of VNF

software14, management & orchestration systems, SDN controllers and SDN

capable switches, all of which are marketed under the company’s SoftCom unified

framework.

Huawei is among the very first vendors to take service provider SDN/NFV

solutions from lab and field trials to commercial deployments. The company made

headlines in Q4’2014, when it revealed that it has over 60 SDN and NFV projects

with more than 20 leading carriers15 around the world. Included among these

projects are commercial SDN deployments with the likes of China Telecom16,

14

Huawei presently has vEPC, vIMS and vCPE offerings. 15

Including Telefonica, China Mobile, China Unicom, and China Telecom 16

In Q2’2014, China Telecom’s Beijing Telecom subsidiary deployed Huawei’s SDN solution for its internet data center. Later in Q4’2014, the operator’s Fujian Telecom subsidiary chose Huawei’s SDN solution for its T-SDN (Transport Software Defined Network). T-SDN will deliver private line BoD (Bandwidth on Demand) over a transport network.



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9.9 Prospects of SDN & NFV Orchestration

Despite accounting for a fraction of revenue, in comparison to VNF software, SDN

controllers and SDN/NFV infrastructure, orchestration is one of the most crucial

aspects for service provider SDN/NFV deployments.

Figure 93: Orchestration as a Percentage of Service Provider SDN & NFV

Spending: 2015 – 2020 (%)


Due to the uniform nature of the physical and virtual elements in a data center

environment, orchestration is a relatively straightforward process. However, the

complex multi-service environment of modern service provider networks makes

orchestration a major challenge due to the variability of costs, resources and

5.00%

5.50%

6.00%

6.50%

7.00%

7.50%

8.00%

8.50%

9.00%

2015 2016 2017 2018 2019 2020

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The SDN, NFV & Network Virtualization Bible: 2015