Cable operators to help drive SDN market to $8.7B by 2020

BOSTON -- The cable industry is working to embrace software defined networking (SDN) and network function virtualization (NFV), but the transition will require a significant amount of work.

"I'm seeing a lot of variety [among cable operators embracing SDN]. There's not a single path," said Chris Bastian, SVP and CTO of cable industry trade group SCTE, during a FierceTelecom event here on the sidelines of the INTX trade show. "It's a very different answer depending on who you're talking about."

But, according to research firm IHS Technology, the market for SDN is poised to take off. The firm today reported that the service provider SDN market -- including hardware, software and services -- will grow from $289 million in 2015 to fully $8.7 billion in 2020, figures that represent a compound annual growth rate of 98 percent.

"Carriers have defined the vision, goals and architectures and are progressing through use cases, proof-of-concept projects, field trials and a small but growing number of commercial deployments," the research firm noted in a release announcing its new SDN report. "The partially proven promise keeps the industry moving as fast as it can, but we are still early in this long-term, 10- to 15-year transformation of service provider networks."

IHS also said that software and outsourced services will comprise 46 percent of SDN revenue in 2020, and that SDN orchestration and controller software revenue is forecast to grow to over $1.8 billion in 2020.

"There are many ways you can approach" deploying SDN, noted Dan Pitt, executive director of the Open Networking Foundation.

Adam Saenger, VP of global product development and management for Level 3, said that moving to SDN and NFV also requires operators to re-evaluate their workforce. He noted that Level 3 has been using SDN technologies internally for five years, and externally with its customers for four years.

"This has been a journey," Saenger explained, adding that cable operators will need to "plan for that [workforce] shift."

In order to smooth the transition from legacy systems to software-defined systems, ONF's Pitt said the group has developed a certification program for network technicians to become familiar with SDN technologies and deployments. "Programmers are going to be needed," Pitt noted.

And, according to several executives, the cable industry's move to DOCSIS 3.1 network technology creates an opening for them to begin virtualizing parts of their network. "That's a trend the vendors are going in," SCTE's Bastian explained.

Ryan McCowan, product manager with vendor Adtran, agreed. DOCSIS 3.1 "is a place where it makes sense to virtualize."

Interestingly, Pitt said that the move to SDN will allow operators to deploy a range of new services to customers. Once such service he pointed to was "data border control," whereby operators will be able to limit the types of data that can pass over country borders. He said regulators in Europe are keen to implement such technology for cyber security.

For more:
- see this IHS report

Related articles:
AT&T on track to virtualize 30 percent of its network functions by end of 2016
AT&T's $10B enterprise spending plan will deepen its SDN-based on-demand, cloud service footprints
AT&T extends fiber to over 950K business locations, enhances on-demand Ethernet reach

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