During the past week, there were a number of announcements from tier-1 telco providers launching virtualized network services that have been in development since at least 2013. Ovum saw these services starting to emerge in 2015 from many smaller network providers (e.g. Telstra/PacNet, Masergy, and NTT/Virtela), leveraging some of the same technology and vendors. 2016 will be the year of global launches by the larger tier-1 telcos and this week's announcements are just an initial wave that will continue into 2017. These providers are not the first, nor will they be the last, to announcement a new wave of virtualized managed services.
On July 18, 2016, AT&T announced the third phase of its Network on Demand (NoD) service portfolio, based on its Network Function on Demand platform. The previously announced network services (Switched Ethernet on Demand and Dedicated Internet on Demand) have been available for some time but restricted to the US region. The new service is noteworthy because it extends and expands AT&T's NoD platform on a global basis, and demonstrates the company's commitment as it continues to invest in and evolve this NoD portfolio over time. It is also important to note that this service is available now.
In the wake of AT&T's announcement of Network Functions on Demand, Verizon has announced its Virtualized Network Services (VNS). It is a strange coincidence to have two such major service announcements in the same week. VNS will become a platform for future enterprise managed services from Verizon based on software-defined networking/network function virtualization (SDN/NFV) technology and universal CPE (uCPE) provided by Verizon. Verizon plans initial services in the US and Europe, with global expansion by the end of 2016. Verizon's roadmap includes future design options with additional virtualized network functions and vendor choices. Ovum expects to see a tidal wave of announcements from large service providers in 2016 and early 2017. They will leverage new technologies (SDN/NFV, virtualization, and cloud) to address customers' need for more agile services and pay-as-you-go consumption models. They won't just be from traditional providers either.
During the last few years, many telco providers (and their suppliers) have promoted the concept of creating an open platform to provide network connectivity with value-added services. Ovum saw 2015 as the year of proof of concepts and trials for many large telco providers. 2016 was going to be year of early deployments, and the Verizon and AT&T announcements are evidence of deployment of new virtualized managed services coming to market. On July 27, 2016, Softbank announced its new set of services based on Cradlepoint/Pertino technology, which is another version of virtualized managed services. Enterprise customers will be presented with a variety of different options from traditional network providers as well as nontraditional providers. Ovum expects to see more announcements from nontraditional telco providers such as software-as-a-service, over-the-top, and Web-centric providers.
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