Biography for Michael Kennedy
Michael Kennedy is a regular FierceTelecom columnist. He is the co-founder and Managing Partner of Network Strategy Partners, LLC (NSP), management consultants to the networking industry--recently purchased by ACG Research. Michael is now a Principal Analyst at ACG Research. He can be reached at email@example.com.
Articles by Michael Kennedy
Leading telecom operators began the network function virtualization (NFV) initiative several years ago in recognition of the need to reduce cost increases and increase revenue growth rates to sustain profitability. While much technical process on NFV and related SDN technology has been made, I believe business process redesign is needed to change the organization and people's jobs if the financial benefits are to be realized.
Virtual business CPE has the potential to create a win-win situation for small and midsize businesses and network operators. Small and midsize businesses are trying to develop network-centric business models, but networks present challenges that are beyond these businesses' managerial and technical capabilities. Service providers, on the other hand, would like to offer managed network services to smaller businesses, but they are struggling to drive service delivery costs down to a point where services are both attractively priced and profitable. Virtual CPE can resolve this dilemma by increasing network service velocity while reducing initial and recurring service costs.
Programmable carrier networks, a new, eclectic, emerging architectural approach, incorporate concepts such as SDN, NFV, shared mesh protection, path computation element protocol and cloud computing concepts and blends them with established transport, switching, routing and network management techniques. The objective of this merger is to overcome the barriers created by traditional network architectures that carriers are encountering as they try to accommodate high and volatile traffic volumes and unpredictable traffic patterns as well as respond to the innovative business models of cloud-based and OTT service providers.
Residences' move from viewing broadcast TV to Internet TV and businesses' pervasive use of rich multimedia content and cloud services are forcing service providers to re-architect their metro networks. The resulting network designs are bringing network content and intelligence closer to end-users.
Network Functions Virtualization (NFV) explicitly targets the two biggest problems facing network operators: bringing costs in line with revenue growth expectations and improving service velocity. But it also has the potential to fundamentally change fixed network economics.
Long anticipated, it now appears that the boundaries between fixed and mobile network infrastructure are fading. Demand for bandwidth coupled with service providers' urgent need to control costs is forcing convergence of network infrastructure, while enthusiastic adoption of wireless devices in all market segments (wireline, mobile, enterprise and consumer) is further blurring the service boundaries.
As data center providers look for ways to reduce capital expenditures, such as data center interconnect and multi-layer optimization, a new opportunity has emerged for software defined networking: transport SDN. However, transport networks face significantly different challenges than packet networks.
Network traffic growth driven by widespread adoption of smartphones, tablets, video content, and cloud computing is exploding. Service providers' revenues are not keeping pace and, thus, the cost to support the traffic growth threatens service providers' operating margins. Which providers will survive this rapidly shifting market?