The document discusses new technologies like network functions virtualization (NFV) and software-defined networking (SDN) that are enabling over-the-top (OTT) providers to build new services and business models more easily. NFV and SDN allow network functions to be deployed as software on standard high-volume servers, storage and switches, replacing proprietary hardware appliances. This commoditization benefits OTTs and also provides opportunities for telecommunications providers to offer network and virtualized network functions as a service using a software-defined business approach. The document outlines example use cases like virtualized customer premises equipment.

1. New Technology, New Services &
New Business Models
Dr. Recep Ozdag
Director of Marketing
© 2014, CYAN, INC.
1

2. The Rise of the OTTs
 OTTs build services on top of
commoditized technologies:
 Scale Out
 Compute and Storage
 Broadcom COTS switches
 Open Source Software
 Scale Up
 Virtualization
 Multi-Technology Compute,
Storage, IP, MPLS, Packet-Optical
Networks
 OTTs are early adopters of SDN
and NFV
© 2014, CYAN, INC. 2

3. Service Provider Business Models
Under Pressure
© 2014, CYAN, INC. 3
3

4. Commoditization
Custom -> Standard -> White-box -> Bare Metal
Proprietary -> Standard -> Open source -> ‘Free’
OTT Business Models exploit Commoditization
© 2014, CYAN, INC. 4

5. What is Network functions Virtualisation?
Classical Network Appliance
Approach
Session Border
Controller
Message Acceleration
Router
BRAS
CDN
DPI Firewall
WAN
Tester/QoE
monitor
Radio Network
Controller
Carrier
Grade NAT
SGSN/GGSN PE Router
Independent
Software
Vendors
Orchestrated,
automatic &
remote install.
Standard High Volume Servers
Standard High Volume Storage
Fragmented non-commodity hardware.
Physical install per appliance per site.
Hardware development large barrier to entry for
new vendors constraining innovation &
Standard High Volume Switches
competition. Network functions Virtualisation
Approach
Adding Machine Typewriter Printing Press
Competitive &
Innovative
Ecosystem
Net Apps Store
Bronze NfV
Gold NfV

6. Impact on Telcos?
© 2014, CYAN, INC.
6

7. Opportunity for Carriers:
Both above and below the Line:
 Integration
 Optical + Packet + Storage + Compute + Software + …
 Agility
 Planning, Operations, PM and Analytics
 DIY Programmability
 Integration with Information Technology systems
 Virtualization and Delegation of Control
 Network and VNF as a Service
 End-User empowerment via APIs
© 2014, CYAN, INC. 7

8. Adaptability and Flexibility
Software Defined Business
 Today’s Assets = Tomorrow’s liabilities
 Obsolescence and cost of maintenance
 Commoditization and revenue erosion
 Opportunity cost
 Adaptability requires Modularity:
 New Applications
 New Technologies
 Modularity is more of a challenge higher up the stack
 Paradox: Hardware is more modular than software
8
CYAN CONFIDENTIAL
© 2014, CYAN, INC.

9. Compelling Advantages:
Cost
• Software Reuse
• Hardware Virtualization Savings
• Reduction in Design Costs
• Hardware Import Duty (multinational
carriers)
• Installation Costs
• Equipment Recovery
• Simplified Project management
• Elimination of site surveys, cabling, etc
• Shipping Costs
• Reduced time to revenue
Revenue
9
CYAN CONFIDENTIAL
© 2014, CYAN, INC. • Quicker physical deployment
• Quicker service turn-up and change orders
• Elastic services as a Utility
• NFVaaS (firewall, load balancing,
encryption..)
• Consistency through automation
• End User configuration
• ICT integration
• Short term, service contracts
• NaaS
• Isolation based security improvements

10. Service Orchestration
Blue Planet Service Orchestration
Network Orchestration
Cloud
Orchestration
APIs APIs
NFV
Orchestration
VNF Services
Controller
Multi-Layer,
Multi-Vendor NaaS
Controller
Access Metro Core
Cloud Services
Controller
10
CYAN CONFIDENTIAL
© 2014, CYAN, INC.

11. A Generic SDN+NFV Architecture
SDN Controller SDN Controller
Cloud
Orchestration
Cloud Management
System
NFV Management &
Orchestration
Cloud Management
System
SDN Controller
SDN Controller SDN Controller
POTN
Network
OSS / BSS
Multi-Domain Orchestrator
Multi-Domain Orchestrator
Multi-Domain Orchestrator
IP/MPLS
Network
Data Center
Telco Cloud
NFV
OpenFlow
Enabled
Network
© 2014, CYAN, INC. 11

12. Standards and Open Source
WAN NaaS
WAN Networks
Cloud Applications
Network
Functions
DC Protocols Transport Protocols
Network Hardware
XaaS
Datacenter Networks
LAN
Hardware
Cloud
Compute
Virtualization
Compute
Servers
Network
Appliances
© 2014, CYAN, INC. 12

13. NFV Driving Network
Transformation
 DC technology is Commoditizing
 Application and Content Networks
 VM and Content Placement
 More Data Centers
 Power Law Size Distribution
 Few Hyper Scale DCs
 Long Tail of Small DCs provide proximity, resilience, low latency,
partition tolerance
 NFV and the confluence of WANs/MANs + DCs
 Multi-layer, multi-vendor WAN/MAN
 Flexible placement of content, functions and applications
 Telco-Cloud orchestration ≡ Integration
© 2014, CYAN, INC. 13

14. ETSI NFV
End-to-End Reference Architecture
© 2014, CYAN, INC. 14
1
 Complies with ETSI’s NFV ISG
Management and
Orchestration (MANO)
framework
 Planet Orchestrate serves as
the orchestrator and VNF
manager, where needed
 Supports centralized and
distributed NFV deployments
 NFVO can stand alone or work
in concert with other Planet
Orchestrate capabilities

15. Example Use Cases
© 2014, CYAN, INC.
15

16. Virtualized CPE
 Provision business Ethernet services
 Run network functions as VMs in central or customer premise servers
vEPC
Firewall NID
appliance
NID Firewall
16
appliance
© 2014, CYAN, INC.

17. Virtualized CPE
vEPC
NID
COTS server NID Firewall
17
appliance
© 2014, CYAN, INC. vFW

18. Virtualized CPE
vEPC
Virtualized CPE running
virtual network functions
over
© 2014, CYAN, INC. 18