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NFV and SDN Only Slightly Offset Costs Needed for U.S. Fiber Investment

NFV and SDN to Play a Role in U
Dan Meyer
Dan MeyerJuly 10, 2017
11:42 am MT
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Deloitte Consulting claims the U.S. needs to invest up to $150 billion in fiber infrastructure over the next five to seven years to support networking demand. However, virtualization technologies like software-defined networking (SDN) and network functions virtualization (NFV) are likely to provide only a sliver of financial relief.

The Deloitte forecast comes from a new report that notes the fiber investment is required for the country to keep on top of broadband competition, as well as enhance rural coverage, and support wireless densification efforts tied to 5G deployments. The firm said it’s unlikely the telecom sector will be able to front all of the costs, with the need for investments “from a variety of sources, including communications service providers, financial investors, and public/private partnerships.”

“Unfortunately, the current wireline industry structure does not provide sufficient market incentives for fiber and broadband deployment,” the report states.

SDN and NFV Support Limited

Dan Littmann, principal at Deloitte and co-author of the report, explained the increased use of SDN and NFV will help offset some of the costs associated with the firms predictions.

“Virtualization does help in terms of making it easier to handle network repairs and maintenance, and does provide some potential cost benefit in terms of speeding up service delivery and provisioning,” Littmann said.

The report notes virtualized platforms can reduce the average time to repair from 21 hours to just five hours; reduce equipment maintenance expenses by 34 percent; and provides 31 percent lower costs related to “moves, adds, and changes.”

However, the software benefits are somewhat muted by the much larger investment needed in terms of the costs associated with actual fiber deployments.

“The greater use of virtualization does help, but does not provide a significant impact in overall costs,” Littmann said. “A lot of the cost is in the labor of deploying fiber. Virtualization does not get around that.”

Deloitte also cited regulatory requirements that operators continue supporting legacy systems, which reduces potential investments into more efficient software-enhanced fiber deployments.

“Carriers are willing to invest in, and could potentially gain tremendous efficiency from deploying new IP networking architectures like [SDN] and [NFV],” the report states. “However, the requirement to operate and maintain legacy TDM-based networks limits carriers’ ability to take advantage of the savings and shift capital to deep fiber deployment.”

PON to Boost Fiber

Operators are increasing their use of software control over passive optical networking (PON) assets to boost the performance of deployed fiber. PON uses a point-to-multipoint architecture to enable a single optical fiber to serve multiple end-points.

In addition to potential cost savings tied to more efficient use of current assets, PON deployments can allow operators to reroute traffic over their fiber connections in case of an outage or service disruption.

AT&T last month said it plans to conduct a 10-gigabit symmetric PON (XGS-PON) trial later this year as part of its plan to virtualize access functions within the last mile of its fiber network. Services to be supported include broadband and backhaul of wired and 5G wireless services.

Verizon recently commissioned Calix to demonstrate channel bonding using next-generation passive-optical network two (NG-PON2) technology. The trial used a software platform sitting in a SDN environment to combine transport channels over a single fiber strand to support speeds up to 80 Gb/s.

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Dan Meyer

About Dan Meyer

Dan Meyer is a Senior Editor at SDxCentral, with a focus on containers, lifecycle service orchestration, cloud automation and DevOps. Dan has been covering the telecommunications space for more than 17 years. Prior to SDxCentral, Dan was Editor-In-Chief at RCR Wireless News.

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