NFV & SDN Poised to Change the Game in Backhaul Routing, Heavy Reading Finds

NEW YORK, Oct. 14, 2014 /PRNewswire/ -- Driven by SDN and NFV, new models for routing in mobile backhaul networks are emerging with the potential to reduce demand for dedicated backhaul routing devices and trigger a major shake-up in this sector, according to a major new report from Heavy Reading (www.heavyreading.com), the research division of Light Reading (www.lightreading.com).

The Future of Routing in 4G Mobile Backhaul Networks reviews the evolving role of routing in mobile backhaul networks in the context of the emerging trends in telecom networking toward increased virtualization and function distribution, as mobile operators grapple with the need to expand their network capacity and agility to support ever more powerful smartphones and advanced apps. This report forecasts operator demand for routers in the backhaul network through the end of 2017.

The report profiles 16 leading mobile backhaul routing vendors, including some key players whose product strategies are disruptive to market demand for routers in the backhaul network.

"Software-defined networking (SDN) and network functions virtualization (NFV) are now impacting the industry's thinking about routers – or just routing – in the backhaul," explains Patrick Donegan, Senior Analyst with Heavy Reading and author of the report. "Consistent with NFV, routing can be centrally located and accessed as virtual instances by other backhaul nodes, rather than requiring dedicated routers throughout the backhaul. And SDN controllers have the potential to reduce, or even eliminate, the need for L3 control intelligence in dedicated backhaul devices."

The success of vendors in this market will be materially impacted by their approach to these issues, Donegan predicts. "Incumbents will inevitably see their market share decline if they fail to take account of both the threats and opportunities that SDN and NFV present. New entrants that are prepared to position themselves at the leading edge of SDN and NFV technology and business cases for backhaul networks have their sights set on capturing operator capex that might otherwise be spent on dedicated routers."

Key findings of The Future of Routing in 4G Mobile Backhaul Networks include the following:

Carrier planning for SDN and NFV promises a discontinuity in the backhaul equipment market. An SDN controller in the backhaul could reduce or eliminate the need for sophisticated control intelligence at the cell site. Virtualized routing could potentially be supported on a COTS server, rendering a dedicated router device unnecessary.

The potential of SDN and NFV is causing some backhaul planners to hesitate before committing further capex to dedicated L3 routers with advanced functionality such as MPLS. But today, any hesitation is routinely outweighed by the more pressing imperative of investing in higher capacity, greater intelligence and superior performance in the backhaul network in the here and now.

We expect 2014 to be the peak year for the backhaul revenues of router vendors, reaching $2.3 billion – up from $2.1 billion in 2013. This combines upgrade and refresh-oriented investment in greater routing capacity at the highest aggregation layers of the backhaul, as well as upgrades and new greenfield investment in 1U and 2U cell site routers out in the access layer. From 2015 we expect the market to be flat to declining, falling back to $2.1 billion once again in 2017.

Dedicated router vendors are aligning their portfolios, features, pricing and marketing strategies to ensure that their products remain relevant in the SDN and NFV era. They are aggressively cutting the prices of their router products, to reduce the cost savings that virtualized routing solutions could potentially offer, and they are promoting key features, such as environmental hardening, miniaturization and synchronization, for which virtualized routing models will need to offer solutions to gain traction.

The Future of Routing in 4G Mobile Backhaul Networks costs $3,995 and is published in PDF format. The price includes an enterprise license covering all of the employees at the purchaser's company.

For additional information, or to request a free executive summary of this report, please contact:

David Williams
Global Director of Sales, Research
Heavy Reading
858-829-8612
[email protected]

Press/analyst contact:
Dennis Mendyk
Vice President of Research, Heavy Reading
201-587-2154
[email protected]

About Heavy Reading

Heavy Reading (www.heavyreading.com), the research division of Light Reading, offers deep analysis of emerging telecom trends to network operators, technology suppliers, and investors. Its product portfolio includes in-depth reports that address critical next-generation technology and service issues, market trackers that focus on the telecom industry's most critical technology sectors, exclusive worldwide surveys of network operator decision-makers that identify future purchasing and deployment plans, and a rich array of custom and consulting services that give clients the market intelligence needed to compete successfully in the global telecom industry.

About Light Reading

Light Reading (www.lightreading.com) combines its research-led online communities and targeted events portfolio to help those in the global communications industry make informed decisions. Lightreading.com is the ultimate source for telecom analysis for more than 350,000 subscribers each month, leading the media sector in terms of traffic, content, and reputation. Light Reading produces targeted communications events and focused one-day conferences each year for cable, mobile, and wireline executives across five continents.

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