Telco Systems has been listed as one of 16 mobile backhaul routing companies in the field of software-defined networking (SDN) and network functions virtualization (NFV) in a new research report by Heavy Reading entitled: The Future of Routing in 4G Mobile Backhaul Networks. Telco Systems is profiled alongside such prestigious industry giants such as Cisco, Ericsson, and Nokia Networks.
The report examines the role of routing in mobile backhaul networks in the context of increased virtualization and function distribution, as mobile operators grapple with the need to expand their network capacity and agility to support ever more powerful smartphones and advanced apps. This report finds that driven by SDN and NFV, new models for routing in mobile backhaul networks are emerging with the potential to reduce demand for dedicated backhaul routing devices and trigger a major shake-up in this sector.
“SDN and NFV are now impacting the industry’s thinking about routers – or just routing – in the backhaul,” explains Patrick Donegan, Senior Analyst with Heavy Reading and author of the report. “Consistent with NFV, routing can be centrally located and accessed as virtual instances by other backhaul nodes, rather than requiring dedicated routers throughout the backhaul. And SDN controllers have the potential to reduce, or even eliminate, the need for L3 control intelligence in dedicated backhaul devices.”
The success of vendors in this market will be materially impacted by their approach to these issues, Donegan predicts. “Incumbents will inevitably see their market share decline if they fail to take account of both the threats and opportunities that SDN and NFV present. New entrants that are prepared to position themselves at the leading edge of SDN and NFV technology and business cases for backhaul networks have their sights set on capturing operator capex that might otherwise be spent on dedicated routers.”
“Telco Systems’ strategy for developing advanced solutions for the SDN and NFV markets addresses the three main challenges facing broadband service providers: leveraging the cloud, providing more value to customers and lowering operational costs, and this report is a validation of that strategy,” according to Moshe Shimon, VP of Product Line Management and Marketing for Telco Systems.
Key findings of U.S. Ethernet Services Vertical Markets Update: 2014-2019 include the following:
- Carrier planning for SDN and NFV promises a discontinuity in the backhaul equipment market. An SDN controller in the backhaul could reduce or eliminate the need for sophisticated control intelligence at the cell site. Virtualized routing could potentially be supported on a COTS server, rendering a dedicated router device unnecessary.
- The potential of SDN and NFV is causing some backhaul planners to hesitate before committing further capex to dedicated L3 routers with advanced functionality such as MPLS. But today, any hesitation is routinely outweighed by the more pressing imperative of investing in higher capacity, greater intelligence and superior performance in the backhaul network in the here and now.
- We expect 2014 to be the peak year for the backhaul revenues of router vendors, reaching $2.3 billion – up from $2.1 billion in 2013. This combines upgrade and refresh-oriented investment in greater routing capacity at the highest aggregation layers of the backhaul, as well as upgrades and new greenfield investment in 1U and 2U cell site routers out in the access layer. From 2015 we expect the market to be flat to declining, falling back to $2.1 billion once again in 2017.
- Dedicated router vendors are aligning their portfolios, features, pricing and marketing strategies to ensure that their products remain relevant in the SDN and NFV era. They are aggressively cutting the prices of their router products, to reduce the cost savings that virtualized routing solutions could potentially offer, and they are promoting key features, such as environmental hardening, miniaturization and synchronization, for which virtualized routing models will need to offer solutions to gain traction.
The full list of vendors profiled in the Heavy Reading report can be found here.
For more information about Telco Systems SDN and NFV solutions click here