Service provider software-defined networking (SDN) and network functions virtualization (NFV) investments will grow at a CAGR of 54% between 2015 and 2020, according to SNS Research.
As service providers seek to reduce costs and virtualize their networks, these investments will eventually account for over $20 billion in revenue by the end of 2020.
At present, virtualized EPC/mobile core, IMS and policy control platforms represent over 70% of all VNF (virtual network function) software investments.
Although the use of SDN is widespread in the enterprise and data center domain, service providers are only beginning to adopt the technology to programmatically manage their networks.
Investments on orchestration platforms will account for nearly $2 billion in revenue by the end of 2020, representing nearly 10% of all service provider SDN and NFV spending.
SDN and NFV not only help address the explosive capacity demand of mobile traffic, but they can also reduce the capex and opex burden faced by service providers to handle this demand by diminishing reliance on expensive proprietary hardware platforms.
Mobile operators and internet service providers have already begun making SDN and NFV investments in a number of functional areas including but not limited to EPC/mobile core, IMS, policy control, CPE (customer premises equipment), CDN (content delivery network) and transport networks.
Related content
- Infographic: Telenor predicts key telco trends for 2016
- CenturyLink to deploy Nuage Networks SDN technology in Programmable Services Backbone
- Amdocs expands NFV offering with Service Design and Create
- ZTE offers 'testbed' for network virtualization innovations
- Tata Communications, Microsoft aim to interconnect businesses via cloud