DriveNets CEO Ido Susan claims the company lands deals about 65% of the time it competes for business with network operators considering a move away from traditional routers to a disaggregated, software-based solution running in a cloud.

The Israel-based company, which counts AT&T as its largest customer, has 96 customers with at least 36 proof of concepts up and running, according to Susan. 

DriveNets paying customers grew five-fold last year and the company has booked more revenue in the first few weeks of 2022 than it did in the entirety of 2021, he said, adding that revenue is in the high eight figures. 

“We are competing head to head all the time with incumbents,” Susan said in a phone interview. “I have a lot of respect for them, but they try to protect their garden with old technology. And I feel like we are in the IBM days with [Hewlett Packard] servers and VMware coming to the market.”

Those incumbents and the vendors that have the most to lose if DriveNets grabs more market share include Cisco, Juniper, Nokia, and to a lesser extent Huawei.

DriveNets is in a position to pull business away from these large companies, many of which have had business with network operators for decades, because it facilitates disaggregation, a simplified and shared infrastructure, and helps operators reduce the cost per bit required to add new services that create additional revenue, Susan explained.

“Our motivation is different. Their motivation is to sell maximum hardware with minimum utilization because they’re getting paid for each port that they’re selling,” Susan said. 

“My motivation is the opposite. I want to sell minimum hardware because I’m not getting any revenue from the hardware, and maximum on the software. So I will get maximum utilization from the network, maximum efficiency from the software, and the capability and services on the software,” he added. 

When DriveNets competes for deals with the likes of Cisco, Juniper, and Nokia, the more established players focus on chassis, acceleration cards and port density whereas DriveNets focuses on how it can simplify and improve network operations.

“Our role today is to go into and replace the big physical routers from the big incumbent with a software-based solution to run it as a private cloud,” Susan explained. “You don’t need one box for mobility, another box for broadband, another one for consumer or enterprise, you’re just running all the workloads with utilization and shared infrastructure.”

While on-premises, private clouds are the main activity and entry point for DriveNets, it also integrates its network cloud software with public clouds to create a hybrid cloud offering. 

“We need to change the operation model, we need to change the way that we design and build the network. We need to drive for innovation because the revenue of service providers is not growing so fast,” he said.

More operators are coming to DriveNets because it’s proven the cloud-native software running on standard white boxes is mature and reliable, operating at a high scale managing terabytes of traffic, according to Susan.

Of course, it doesn’t hurt having AT&T as a showcase customer. The operator began running some of its network backbone on DriveNets core routing software in September 2020, and at the time Susan said he expects all of AT&T’s growth and legacy traffic to be running on DriveNets’ technology around late 2022.

“Customers understand that the world moved to software and they see what happened with the cloud,” Susan said. “They don’t want to be left behind.”

The sales and initial implementation cycle at an operator typically runs 12 to 24 months, but deployment ramps up quickly from there, he added. “Between three or four years, we are converting almost the entire network.”

Susan declined to share recent numbers about the amount of AT&T traffic running on DriveNets technology today, but he describes it as a “massive deployment” and said he hopes the operator will share more details about the effort soon. 

“It’s very easy for [operators] to keep the old incumbent they’re used to, but many organizations know that the only way to change is to disrupt,” Susan said. Indeed, it’s probably no coincidence that AT&T CTO Andre Fuetsch described DriveNets as a “disruptive supplier” when he announced the carrier’s work with the company in 2020.

The 7-year-old company has a lot of wind in its sails, including a $208 million Series B funding round in early 2021 that raised its valuation above $1 billion. It also plays a key role in the Open Grid Alliance, which it formed in April 2021 with VMware, Dell Technologies, MobiledgeX, and PacketFabric to foster a re-architected internet converged as a shared platform for distributed compte, data, and intelligence at the edge.