In March, The Rayno Report told you about an exciting new market developing for service-provider software called Lifecycle Service Orchestration (LSO). We projected the total opportunity for LSO technologies in enterprise service offerings will approach $2.75 billion by 2019, according to our March report, “LSO Overview and Market Forecast.”
It now appears that these estimates may be conservative, based on feedback I got from service providers at last week’s MEF annual meeting, in Vancouver, B.C. In “LSO Overview and Market Forecast,” survey results from more than 60 leading service providers indicated the main driver behind deploying open LSO software is the need to more quickly provision and deploy new communications services. The global operators are looking to move to a more cloud-like model, and LSO helps them do that. It now appears to me that the level of urgency is increasing.
LSO will help service providers build another open, software layer for orchestrating and provisioning new services. LSO integrates service orchestration, fulfillment, control, performance, assurance, usage, analytics, security, and policy of communications and networking functions. Best of all, its based on open and inter-operable standards, not proprietary operations support systems (OSSs), as was common in the telecom industry in the past.
In our report, I said that LSO will basically replace OSSs over time. This will be done in two ways: Service providers will install new LSO software, which we describe as “Native LSO,” or they will migrate existing OSSs to the more open LSO model. In most service providers, both things will be happening at the same time.
In Vancouver, I conducted more than 10 interviews and held many discussions at the MEF meeting, including a filmed round table, a panel, and some chats in the hallway. There seems to be a growing level of urgency among service providers to overhaul their infrastructures to launch dynamic services. Several attendees and members of the MEF told me they thought my LSO numbers were low.
I would rather be conservative than issue earth-shattering pronouncements that never happen. Indeed, it’s possible the numbers will be much larger and I’ll have to increase the forecast. LSO is being seen as a strategic initiative as part of a broader movement to open software that is compatible with Software-Defined Networking (SDN) and Network Functions Virtualization (NFV).
The survey from our report indicated that 54.6% of operators regard their OSSs as “outdated” with a need to be updated or overhauled; and 60% said they were lacking a capability to launch new services in a cost-effective and time-effective manner. This is what is generating the urgency. Given that the OSS market is estimated to be about $50 billion, it makes sense that, over time, LSO will climb toward that level as it pushes older OSS systems out.