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What is NFV and why is it significant to the networking industry?

June 9, 2014 – What is NFV and why is it significant to the networking industry?
With the increasing number of smart phones and mobile devices, more businesses and enterprises are depending on improved network communications. Consumers are demanding more information and everyday lifestyle decisions to be handled online. Carriers face the dilemma of managing unsustainable network traffic growth. Network traffic and the corresponding cost of maintaining networks are already outpacing revenue growth and predictions forecast andit will grow increasingly worse over the next decade.

To sustain profitability, carriers are looking to network operations to drive long-term network cost reductions and accelerate the speed of new revenue generating services delivery.Carriers are particularly eager to drive CapEx down and take advantage of affordable higher performance computing to achieve that goal. By using standard servers, they not only reduce the equipment cost, but more importantly, reduce size and power requirements.With Network Functions Virtualization or NFV, they can realize cost and network flexibility benefits by virtualizing many common wide area network functions. Although it will take years to implement, NFV is expected to impact network spending and impact the networking vendor landscape.

NFV virtualizes network services via software, giving carriers the application performance in software which historically was only found in high-cost proprietary hardware.NFV replaces dedicated network hardware with virtualization software running on commodity servers. NFV decouples network functions from proprietary hardware appliances and implements the network functions through software. Services provided by a network operator such as DNS, firewalls, NAT etc. are traditionally achieved through proprietary hardware which is physically injected into the network.

The concept of NFV suggests bringing in virtual machines (VMs)running on industry grade server hardware performing all of these functions in software. This also means that the actual processing, for say a firewall, may or may not be done on the node physically attached to the network but rather anywhere on a VM. NFV foresees a fully virtualized infrastructure which should be delivered using networking components that consolidate all differential features in software and only using standardized hardware so it can be scaled up or down without any physical changes.

The Motivation for Taking the NFV Route

Network operators are motivated to adopt NFV in their networks due to the cost of purchasing and maintaining proprietary hardware. Most operators already have a variety of proprietary hardware, but when they want to introduce a new network service it often requires additional hardware, plus more space and power to accommodate these boxes. If they take that approach, it’s a costly, time intensive, error prone and not scalable process. Therefore they try to allocate the maximum bandwidth that might be needed, but it’s often a waste of physical resources which can’t be used in other scenarios.

Moreover, recovery from a single point of failure requires physical intervention and often unacceptable down time.When the hardware reaches end of life it requires a complete cycle of procurement, design, integration and deployment.

Benefitting from NFV

NFV intends to solve several of these problems by leveraging standard IT virtualization techniques on consolidated generic high volume servers, switches and storage. These could either be placed in data centers, on network nodes on in the end user premises. The immediate benefits are:

  • Orchestration – The network creates, monitors and repairs VNF instances in software. We can already imagine the remotely setting up a server on Amazon cloud vs. having to host it locally, setup and expand its capabilities. NFV would take that a step ahead.
  • Reduction of onsite visits – NFV has the ability to help reduce truck rolls to customer sites, and is a huge cost saving for operators.
  • Cost effectiveness for consumers – NFV would only bill the customers for services provided (time, number of users, bandwidth) vs. charging the whole setup cost.
  • Efficient resource utilization – Would be able to consume any unutilized resources and computing power in other services being run remotely by software.
  • Cost effectiveness of hardware needs – The bulk of unique functionality for a particular network service would be in software – leading to more homogenous type of hardware needs that could be produced in bulk and thereby be would be less expensive.
  • Lower operating costs – Improved network management efficiency would be a huge leap i.e. being able to create, modify, experiment and shutdown a network can result in dramatic improvements in down time.
  • Flexibility and agility – Scaling up or down of services is just a matter of configuration to quickly address changing demands as well as providing room for experimentation.

With NFV, carriers’ long-term goals to drive down total CapEx spending and significantly reduce networking equipment costs can be achieved. This shift from proprietary hardware based implementation to software can lower the barriers to entry for new equipment suppliers to enter the market, drive down pricing andopens up new opportunities for new revenue sources for many non-networking suppliers.