White paper from Cohesive Networks - Enterprise Architecture Networking How cloud service providers can use VNS3 and overlay networks to offer customer-focused security and control.

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White Paper
June 2014
Copyright Cohesive Networks
Cloud Service Providers:
Offer Customer-Focused
Cloud Solutions with
Overlay Networks

2. Cloud service providers (CSPs) and telecommunication firms are now beginning to offer
more cloud computing features to compete with current industry leaders like Amazon
Web Services, Google, and Microsoft.
The market is growing and more competitive for telco and CSP entries:
• Infrastructure as a Service (IaaS) is expected to grow at a rate of 47.3% in 2013
to nearly $9 billion,
• The public cloud market is currently worth $15.1 billion,
• Spending in the public cloud will reach $207 billion by 2016,
• Global telco operators will pour over $130 billion into cloud services annually
by 2015
IT architects and business leaders are wary of security risks and vendor lock-in, yet
cloud adoption is a clear enterprise need.Adding to the complexity, cloud providers of
all sizes and pedigree do not always offer the control and security needed for specific
customer use cases such as US HIPPA regulations.
What can CSPs offer to separate themselves from industry-leading clouds, new
entrants and even cloud washers? Telco and CSPs must differentiate in order to to
attract customers. With added control and network security, CSP network features and
value will get noticed in the market.
Telcos with massive infrastructure can become heavy hitters overnight when overlay
networks transform data centers into cloud-enabled compute capacity using NFV and
overlay networks. Overlay networks can improve interoperability, attract more enterprise
customers, and enhance CSP market position.
Enterprise customers win when CSPs offer cloud networking capabilities that allow
customers to confidently migrate to the cloud. Added to the scale, cost savings, and
resources of cloud infrastructure, overlay and NFV based cloud networking make
cloud adoption a no-brainer for enterprises.
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Summary
Network FunctionVirtualization
Cohesive Networks White Paper

3. Traditional voice and data providers are looking to cloud solutions for
revenues and customer retention. Reports cited by Ericsson estimate that
global telecommunications operators will pour over $130 billion into cloud
services annually by 2015. Yet rebuilding networks, data centers, and systems to
fit the cloud model can be a drain on time to market and resources.
Cloud service providers (CSPs) and telco firms are now beginning to offer more
compute, storage, and capacity at on-demand, flexible pricing. The new cloud-
powered services will help telco firms compete with cloud offerings such as
Amazon AWS, Rackspace,
Microsoft Azure, and European
firms including Interoute,
GreenQloud, and ElasticHosts.
Cloud computing is growing, in
market size and competition.
The cloud computing industry is
currently dominated by non-telco
giants such as Amazon, CSC,
Rackspace,VMware, and Microsoft.
Gartner Research estimates that
enterprise spending on public
cloud services grew by 15 percent
to $109 billion in 2012, and
public cloud spending will reach
$207 billion by 2016.
The opportunity for massive
cloud-focused growth is there for
telco operators. In a separate
report, Gartner predicts the
Infrastructure as a Service (IaaS) segment of cloud computing will continue to
lead the cloud services market, growing 42.4 precent in 2012. Infrastructure as a
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Push to Offer Cloud Services
June 2014
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Network FunctionVirtualization
Cohesive Networks White Paper

4. Service (IaaS) is expected to grow at a rate of 47.3 precent in 2013 to nearly $9
billion.
Security is still a primary concern in cloud computing, especially in public and
hybrid environments.The IDG Enterprise Cloud Computing Study from January
2012 found that 70 percent of respondents cite security as a barrier to
implementing cloud strategies. Worries over accessing information (40 percent)
and concerns about information governance (37 percent) also ranked highly.
IT architects and business leaders are wary of security risks and vendor lock-in,
yet cloud adoption is a clear enterprise need. A reported two-thirds of
organizations in an IDG study believing that “cloud computing is a very /
somewhat important enabler of business innovation.” A Technology Business
Review report found the broader public cloud market (beyond just the top 50
vendors) grew 25 percent from the fourth quarter of 2012 to the fourth quarter
of 2013. The report estimates the market to be worth $15.1 billion, and the pace
of cloud acceptance gaining rapidly with enterprise IT.
In a larger, more competitive public cloud IaaS market, telco and CSPs must
differentiate in order to to attract customers. Services based in real world use
cases can fight enterprise fears of security and lock-in to boost cloud adoption.
CSPs can stand out by creating robust networking features that add security and
flexibility for customers and enterprise-friendly pricing comparisons models.
Adding to the complexity, cloud providers of all sizes and pedigrees do not
always have the control and security needed for specific customer use cases. For
example, healthcare applications require strict data sharing standards to meet US
HIPPA regulations. Cloud offerings alone not secure enough.
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Security Fears Don’t Slow Demand
Network FunctionVirtualization
Cohesive Networks White Paper

5. As part of an IaaS offering, some providers have added networking capabilities to
provide more security. Google GCE and Amazon Web Services (AWS) stand out
for their networking and security offerings. Yet even providers’ in-cloud Virtual
Private Clouds (VPCs) have limits on the degree of accessibility and control
enterprise IT architects need to comply with security regulations.
Enterprise customers will flock to the first vendors to offer greater security and
interoperability between geographies and cloud providers. What technologies
can providers offer to differentiate from industry leaders, new entrants, and
especially from cloud washers?
What if there was a way for telcos and CSPs to offer lock-in proof services?
Along with on-demand compute, storage, and flexible capacity, CSPs can offer,
dynamic networking features can be critical to compete in the growing cloud IaaS
market. CSPs can offer enhanced cloud networking based in software, rather
than at the hardware-heavy IaaS layer. Software-based networking technologies
include overlay networks built with network function virtualization, or NFV.
Overlay networks free cloud users to deploy practically any hybrid resource
across hardware vendors, geographic locations, and cloud environments. Telcos
and CSPs can use overlay networks to connect and extend data center networks
to make any compute resource into a cloud-powered data center. By offering
expanded cloud networking features, CSPs can attract customers and ease cloud
on-boarding.
Overlay networks build on top of existing network infrastructure. Overlay
networks use Network FunctionVirtualization (NFV) appliances to deploy a
cloud network over top of any existing CSP network.
Cloud users can create overlays to control routing, firewalls, and network end
points within a shared public cloud environment. Controlling network features
with NFV allows both CSPs and their customers to to connect data centers and
cloud servers into a secure hybrid cloud network.
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Overlay network benefits explained
Network FunctionVirtualization
Cohesive Networks White Paper

6. NFV virtualizes network functions previously found only in proprietary,
physical hardware. While traditional network hardware vendors install physical
appliances inside corporate data centers, a software instance-based NFV appliance
provides all the same functionality without the hardware rack or ethernet cables.
Newly federated data centers can instantly become cloud resources unlike
anything a single enterprise customer could build, and at much lower costs. Large
telcos with massive infrastructure can become heavy hitters overnight when
overlay networks transform data centers into cloud-enabled compute capacity
using NFV and overlay networks.
Overlay networks can replace hardware-based network devices such as routers,
firewalls, and security appliances. Unlike hardware, the software versions of
networking appliances are capable of running on top of any virtual environment.
Because it is software, CSP customers can easily deploy NFV appliances in the
application or virtual layer in any public, private, or hybrid clouds.
With applications freed from the constraints of underlying hardware and
middlemen, CSP customers can bridge their data centers and cloud-based
resources without changing everything. Customers can also benefit from overlay
networking by adding security features such as IPsec and SSL/TCP connections to
meet compliance and industry regulations.
Overlay networks with NFV add more user control. Public cloud IaaS with
interoperable overlay networks are larger and more scalable than individual
companies’ networks. Added to the scale, cost savings, and resources of cloud
infrastructure, cloud networking features make cloud adoption a no-brainer for
enterprises.
Providers unwittingly limit public cloud adoption and frustrate potential
customers by disabling features that share control with customers. Public cloud
customers are not allowed to view or access lower network layers in a shared
environment, which ensures the broader cloud network but harms individual
cloud users. For example, CSPs often disable UDP multicast without an option to
re-enable.
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Network FunctionVirtualization
Cohesive Networks White Paper

7. Multicast is one of the most popular and efficient ways to do one-to-many
communication over secure network infrastructure. The most common
transport layer multicast protocol is UDP multicast. Enterprise data centers,
stock exchanges, and multimedia content delivery networks all use multicast to
deliver information to a group of computers simultaneously in a single
transmission.
Why do cloud providers disable multicast?
Providers themselves use broadcast and
multicast to offer services such as server
motion and IP failover. Additionally, multicast
and broadcast are difficult to manage in
multi-tenant cloud environments. Multicast is
considered “chatty” and can crowd public
cloud networks.
With NFV-based overlay networks, CSPs can
enable otherwise restricted protocols for
customers. Overlay networks simply create a
private, sealed network on top of an existing
cloud network. Customers can use the
overlay network to control network features, including UDP multicast. Overlay
networks can improve interoperability, attract more enterprise customers, and
enhance CSP market position.
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Differentiate with user-centric
cloud networking
Network FunctionVirtualization
Cohesive Networks White Paper

8. NFV can also enable CSPs to offer automated service chaining, or dynamic
network provisioning to support applications. Before NFV, network operators
had to manually build firewalls and load balancers for each application. Now, NFV
technology lets CSPs make specific network functions available as needed.
Automated service chaining lets CSPs charge for on-demand specialized network
services, while application owners will no longer have to struggle to deploy and
re-deploy cloud applications.
In summary, enterprise customers win when CSPs offer cloud networking
capabilities that allow customers to confidently migrate to the cloud. With added
control and network security, CSP pricing and value can stand out against
competitors. By offering cloud resources with superior networking technology,
customers can easily use and understand the offering. Overlay networks’
broadened capabilities and interoperability solve vendor lock-in paralysis and
create truly on-demand, customer-focused cloud systems.
Africa has over 700 million mobile phone users and according to Jamal Saghir, the
World Bank Director for Sustainable Development in the Africa Region. He
writes, "the Internet and mobile phones are transforming the development
landscape in Africa."Yet,African end users must negotiate a telco market
segmented by a patchwork of national and trans-national carriers.The fragmented
market also makes SMS advertising error-prone and less cost effective for brands.
An SMS bridge operator based in West Africa saw an opportunity to put cloud
networks to use. The company needed to integrate the SMS infrastructure of
multiple national carriers throughout Africa, but without the large capital costs of
data centers and network hardware.
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NFV use case:African telco market
Network FunctionVirtualization
Cohesive Networks White Paper

9. The company created their own overlay network using public cloud infrastructure
based in the British Isles. The overlay network instantly made the SMS operator
into a global player.
The company now has full visibility and control over their cloud-based network.
They in turn meet the security and integration their customers and partners
require to connect to Africa’s 700 million mobile users.
Overlay networks and flexible infrastructure allow the SMS bridge operator to
offer a remarkably cost effective SMS integration service to developing markets
across Africa.
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June 2014
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Network FunctionVirtualization
Cohesive Networks White Paper

10. Offer customer-focused cloud solutions with overlay
networks
CSPs can easily transform data centers into cloud-enabled
compute capacity by using NFV and overlay networks. Overlay
networks improve interoperability, attract more enterprise
customers, and enhance CSP market position.
CSPs can useVNS3 to offer customers the ability to deliver
application-centric networks to connect offices, customers, and
partners globally. VNS3 has delivered close to 200M device
hours of over the top, application networking in the public
clouds since 2008.
VNS3 is a patented approach to NFV and overlay networks that
gives end customers control in the cloud.
To learn more, contact Cohesive Networks.
June 2014
Copyright Cohesive Networks
VNS3 Provider Edition
Resources:
For more on theVNS3 for
Provider Edition, see
cohesive.net/products/vns3/
provider-edition
Subscribe to our blog for the
latest on NFV and cloud
computing cohesive.net/blog
For details and specifications for
VNS3, see cohesive.net/support/
product-resources
Network FunctionVirtualization
Cohesive Networks White Paper

11. Patrick Kerpan, CEO and co-founder
Mr. Kerpan is responsible for directing product, technology and sales strategy. Mr. Kerpan brings
more than 20 years of software experience to the role of CEO and was one of Cohesive
Networks's founders in 2006. Previously he was the CTO of Borland Software Corp which he
joined in 2000 through the acquisition of Bedouin, Inc., a company that he founded. Mr. Kerpan was
also the vice president and general manager of the Developer Services Platform group at Borland,
where he was instrumental in leading the Borland acquisition of StarBase in 2003. Before founding
Bedouin, Inc., Mr. Kerpan was a managing director responsible for derivatives technology at
multiple global investment banks.
Chris Swan, CTO
Chris Swan is CTO at Cohesive Networks, where he focuses on product development and
product delivery. Chris was previously at UBS where he was CTO for Client Experience working
on strategy and architecture for web and mobile offerings across all regions and business divisions.
At UBS Chris was co-head of Security CTO focussing on identity management, access control and
data security. Chris represented UBS as Director on the Steering Committee of Open Data
Center Alliance (ODCA), an industry association focussed on enterprise cloud adoption.
Before joining UBS he was CTO at a London based technology investment banking boutique.
Chris previously held various senior R&D, architecture and engineering positions at Credit Suisse,
which included networks, security, data centre automation and introduction of new application
platforms. Before moving to the world of financial services Chris was a Combat Systems Engineering Officer in the Royal
Navy. He has an MBA from OUBS and a BEng from the University ofYork.
Sam Mitchell, Senior Cloud Solutions Architect
As Senior Cloud Solutions Architect, Sam Mitchell leads all technical elements of the
global sales cycle. Mitchell runs demos, technical qualification, technical account
management, proof of concepts, technical and competitive positioning, RFI/RFP responses
and proposals.
Before Cohesive Networks, Mitchell was a Cloud Solution Architect at Platform Computing, which
was recently acquired by IBM. He was also a Lead Architect at SITA, where he headed up OSS BSS
Architecture, Design and Deployment activities on SITA's cloud offerings.
June 2014
Copyright Cohesive Networks
About the Authors
Network FunctionVirtualization
Cohesive Networks White Paper