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SNS Research estimates that service provider software-defined networking (SDN) and network functions virtualization (NFV) investments will grow at a compound annual growth rate (CAGR) of about 45 percent between 2017 and 2020, eventually accounting for nearly $22 billion in revenue by the end of 2020.

The “SDN, NFV & Network Virtualization Ecosystem: 2017 – 2030 – Opportunities, Challenges, Strategies & Forecasts” report estimates that SDN and network virtualization investments in this segment already accounted for $12 billion in 2017.

In addition to service provider uptake of SDN, the adoption of software-centric networking is also continuing to grow in the enterprise and data center segment. This is spearheaded by Internet giants, data center operators, and large enterprises.

New market players are beginning to emerge as service providers accelerate their transition to software-centric networks. SNS cites companies such as Mavenir Systems and Affirmed Networks, which have emerged as direct competitors to established wireless network infrastructure giants.

The SNS report says that with the emergence of initiatives such as the Linux Foundation’s Open Network Automation Platform (ONAP), ETSI’s Open-Source MANO (OSM), and SK Telecom’s T-MANO, solutions are beginning to be commercialized that can perform integrated management and orchestration of VNFs from multiple vendors.

Finally, the report says that due to the software-oriented nature of mobile core functions, the evolved packet core (EPC) has emerged as one of the most feasible examples for demonstrating the benefits of NFV in a mobile operator network. Most initial vEPC investments were overlay deployments to run in parallel to the operator’s production EPC, with a focus on IoT and non-consumer services.

Providers – including AT&T, NTT Docomo, SoftBank, SK Telecom, LG Uplus, Telefónica, Vodafone, SFR, Telenor, Deutsche Telekom, Telstra, and Etisalat – are already running live traffic and services over vEPC and virtualized 2G/3G mobile core platforms.

SNS chart

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