Telecoms operators are keen to inject some flexibility into their networks.

Virtualising key network functions will enable them to do that and recent NFV-related announcements from both tier-one operators and smaller players across the world suggest that virtualisation is starting to move from hype to reality. Mass-market rollouts are some way off though, and many telcos are still weighing up their options, particularly when it comes to financing NFV projects. But there are steps telcos can take now to capitalise on that promised flexibility, provided they are willing to adopt a ‘beta’ approach to new services.

The global network functions virtualisation (NFV) market will be worth US$2.4 billion in 2018, up from $181 million last year, according to Anaylsys Mason. “We forecast that NFV and SDN drivers will start to overpower inhibitors in 2016,” principal analyst Glen Ragoonanan predicted in June.

“The clever service providers are looking at those functions where you can capture value today,” says Gordon Rawling, director of EMEA marketing at Oracle Communications. This includes areas such as virtual CPEs, aspects of virtualised core, charging and rating functions. “[It’s about] balancing the desire to be architected perfectly with taking value from the network today,” he says. “Take the value today; don’t try and quest for perfection.”

Paolo Campoli, service provider CTO at Cisco’s Europe, Middle East, Africa and Russia (EMEAR) business agrees. “[Telcos] have to shift their mentality [and consider] perpetual beta,” he says. “Do what Google does.” In a virtualised environment an operator can make a service profitable with only 5% penetration, compared with around 30% for legacy services, Campoli says.

Cisco is one of a number of vendors working with Deutsche Telekom’s T-Hrvatski Telekom unit on its all-IP TeraStream pilot network in Croatia that is based on SDN and NFV principles. Earlier this year T-HT added an IPTV service in record time, Campoli says.

“It normally takes something like eight months, 10 months, maybe more...We implemented this in less than 50 days,” Campoli says. “[It shows] what you can achieve on an NFV, highly-simplified, de-layered network,” he says. Deutsche Telekom