As AT&T, Verizon and CenturyLink migrate to SDN, reliability and service agility are top priorities

Sean Buckley, FierceTelecomAt the recent TIA 2016 trade show, a group of service providers including CenturyLink (NYSE: CTL), Verizon (NYSE: VZ) and XO Communications gathered on a stage to talk about transitioning to SDN and NFV.

What was striking about the panel was how all three operators were concerned about making SDN and NFV reliably work in their networks.

A key issue for traditional service providers in adopting any new technology is alleviating downtime. In the event that a Web 2.0 company's app goes down, a user may try the app a few times, and come back later to see if it works.

However, in the traditional service provider world -- particularly those serving business customers -- any downtime means lost revenues. A financial company that relies on low latency network connections could lose out to a competitor if a trade can't be completed, for example.

An incumbent provider like Verizon has to change various business and technology processes without impacting existing services.

"The challenge for telcos is you're talking about interoperability between next-gen networks, legacy networks and are things that are a bit scary about making the jump," said Andrew Ray, director of planning of network support systems for Verizon, during the TIA SDN panel.

New benefits, services emerge
Putting aside the migration issues, the SDN and NFV migration affords service providers with various benefits, including service delivery agility.

One element is on-demand services, which allows user to control and provision bandwidth. AT&T (NYSE: T) and Level 3 Communications offer an Ethernet on Demand service that allows businesses to increase or decrease the amount of bandwidth they need in real time.

Verizon, while still early in its SDN journey, is seeing similar benefits to reduce service activation times. The service provider told investors during a recent Wells Fargo event that it plans to transfer its relevant network functions to a virtual environment by the end of 2018.

Besides offering on-demand services, service providers are starting SD-WAN services with the aim of appealing to multi-site business customers. While still an emerging concept, what's compelling about SD-WAN is that it can provide centralized network control, and agile, real-time traffic management over multiple links.

Following initial efforts by Verizon and EarthLink, CenturyLink joined the SD-WAN fray this week with a service offering that bundles site connectivity, equipment, software licensing, configuration, performance tuning and monitoring with a management and analytics portal.

However, CenturyLink is being careful with how it delivers SD-WAN by allowing customers to test out the service free of charge for 90 days.

"The proof of concept is as much for our customer as for us," said Eric Barrett, senior director of network product management for CenturyLink, in an interview with FierceTelecom. "A lot of customers are interested in this but because it's a new technology they are not ready to say 'hey, I have 1,000 locations, where do I sign?' and it's hard to understand it without a proof of concept program."

Changing vendors' mindsets
The migration to SDN and NFV is forcing vendors realign their product focus from hardware to software. As a result, a number of traditional hardware vendors like Adva Optical Networking, Ciena and Cisco have acquired other vendors to bolster their SDN and NFV capabilities.

Adva purchased Overture Networks, which brought their Ensemble orchestration solution for virtualizing networks that it can upsell its optical customers. Ciena acquired Cyan Networks, a company that developed the Blue Planet software that's being used by CenturyLink.

What's also motivating these customers to get a piece of the SDN pie is being able to respond to Tier 1 telco needs. AT&T has continued to add more vendors to its Domain 2.0 Program. To compete for business, AT&T requires vendors to stay ahead of the innovation curve.

Krish Prahbu, AT&T's CTO, recently told investors that if vendors decide to "stick with their existing business model they run the risk of losing their business to another vendor because the new vendor will be delving to get software we're looking for."

The telco said it is on track to transfer about 30 percent of its apps into a private cloud by the end of this year. Thus far, AT&T has transformed 5 percent of its apps into software.

But even with all of the change that virtualization brings, XO says some elements like routers will remain intact for a number of years to come.

"I think for us, there's going to be a portion of our network that will stay on purpose-built hardware for a long time," said Matt Bateman, senior network architect for XO, during the TIA panel. "Our core routers in our backbone are not changing anytime soon."

The path to SDN and NFV may be one of the most disruptive transition for traditional providers, but the message is clear: the industry must tread carefully.--Sean