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SD-WAN OTT Services Turning Telcos into Plumbers

June 12, 2018 / in SD-WAN / Add Comment

What makes VMware’s Virtual Cloud Network a concern for service providers

Service providers plumbing work

*Image by Flickr user trontnort

After the acquisition of VeloCloud by VMware I was asked by several people in the industry, mainly service providers, for my view on where VMware will take this acquisition to. I, of course, didn’t have any inside information on what are the reasons for VMware to go and acquire an SD-WAN company but I provided my view in a blog post just after the announcement. Go ahead and read that post as it resonates well with the latest VMware announcement on their Virtual Cloud Network.

What does VMware offer

The vision of VMware’s Virtual Cloud Network is to allow enterprises to create their own virtual digital network securely connecting distributed users, applications and public and private clouds.

To realize this vision, VMware is combining several components including:

  • NSX Data Center, a network virtualization platform for the enterprise data center, adopted by more than 4,500 VMware customers globally
  • NSX Cloud, designed to overcome cloud operational inconsistencies resulting from using different clouds (public and private). It provides consistent networking and security for applications running in both private VMware-based data centers and natively in public clouds. VMware added new native capabilities for applications running in Microsoft Azure
  • VeloCloud based SD-WAN that integrates with NSX Data Center and Cloud for extending the enterprise network to the cloud
  • VMware vRealize Network Insight for real-time monitoring and management

As other SD-WAN solutions, the VMware Virtual Cloud Network works as a network overlay rendering service provider network to a pipe. This allows enterprises to bypass the service provider and directly acquire their networking needs from VMware regardless of the network connection/provider used.

The cloud provider threat

Cloud providers such as Amazon, Microsoft and Google provide enterprise services such as communications, collaboration and storage. While it makes a lot of sense for them to cooperate with SD-WAN vendors and service providers for improving networking and service delivery to enterprises, their appetite is bigger than that. The offering of a complete virtual network by cloud providers to enterprises, bypassing the service provider, shouldn’t come as a surprise. This will happen through an acquisition of SD-WAN vendors or self-development.

Telcos should take their destiny in their own hands when it comes to enterprise network services or they will be left to do only the plumbing work.

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Closing notes

SD-WAN is offered as a closed end-to-end solution regardless if it is offered as a product to be installed and managed by the enterprise/service provider, partially managed and hosted by the vendor or as a fully hosted OTT solution coupled with a virtual network (as an overlay using bulk purchased bandwidth). In all of these options, the Telcos function mainly as a reseller.

Next steps

 

 

Learn about security and SD-WAN integration, should you trust your SD-WAN vendor for security features?

How can Telcos avoid the SD-WAN vendor lock through a community-driven ecosystem? Learn more

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Tagged With: Amazon, Cloud Providers, Google, Microsoft, Telco, VeloCloud, VMware

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Amir Zmora

Amir Zmora

Blogging about new technology trends and their impact on markets and people.

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