service layer architecture

Juniper service-layer middleware: Get the latest report

We have completed a full report on the critical service-layer middleware announced October 29th by Juniper Networks, called Junos Space. The report is free; Download it now.

Telstra’s separate susidiary buzz: Government plan could zap ROI

Telstra, Australia’s national carrier, remains locked in a dispute between its shareholders and the Australian government, which proposes to break Telstra up to support its broadband network initiative. Telstra believes it can play a role in NBN, as the network is called, without structural separation. Discussions on how that would be accomplished were proceeding nicely, according to Telstra, until the legislation for separation was introduced.

We are of the view that separation like this is not likely to succeed at its objectives and in fact is more likely to compromise them. In addition, it would clearly undermine the value of Telstra’s shares, which have been sold off to the public for some time through yet another government program. To take steps to devalue them now is not likely to create confidence in any new government process, including NBN.

Then there’s a very important truth, which is that competition always lowers price and always creates overbuild and thus always lowers net industry ROI. There are situations where that is reasonable; some geographies have ample demand density. Australia doesn’t appear to be one of them, according to our model.

If the government’s goal is to create competition in the interior or service portion of the network by making the access network into a shared utility, it should have clear indicators that the ROI in that service portion is sufficient to create real opportunity. Without that, there could be a lot of future failures in the center, which would undermine the profitability and sustainability of the new edge—whatever it turns out to be.

Cisco’s ISR G2 and Borderless Networking: Service layer implications?

Cisco has announced a new generation of its popular ISR platform (G2, fittingly), and also announced an initiative/architecture called Borderless Networking. The ISR upgrades are performance enhancements to the earlier models based on what Cisco calls the “Service-Ready Engine” that can support Linux applications directly, not through the older AXP insert card.

Borderless Networking is harder to pin down, however. It appears to be what a Cisco PR video calls a “recommitment” of Cisco to some core technologies rather than a new announcement. But it is possible that Cisco will offer something new and substantive there. From the positioning, it appears to be a service-layer strategy focused on creating an “IT control plane” from Cisco’s data center and virtualization technology. Whether it’s real or slideware is the question.

Cisco often makes announcements like this to anticipate announcements by competitors, and a number of them may be planning something in the service layer area within the next month. As we’ve noted, this is a critical area, and if Cisco can create a credible “IT control plane” based on data center virtualization, it could have an impact in the space. Recent trends within Cisco management and organization, however, seem to suggest a de-emphasis on software products and on network abstraction and management, key ingredients in a service-layer strategy.

Cisco’s Starent acquisition could be LTE procurement zone play

Cisco wrote another big check, this time to acquire Starent, a major player in the mobile/LTE space. And with the move, it may have leapfrogged a number of competitors. Starent and Cisco were somewhat competing previously, and Wall Street reports that it expected Juniper to announce a partnership with Starent that would have played in the AT&T procurement zone for mobile IP. Motorola was also a Starent partner, and to the extent that either of these deals was meaningful, they now have to be re-evaluated.

What may be most significant here is the procurement zone angle, in fact. Since we’re hearing that network operators worldwide are moving to a zone strategy, the acquisition of critical product mass in key zones is now vital for vendors. Cisco’s move signals an M&A wave to pluck up key components, since it’s now clear that major players will acquire vendors and thus kill simple partnership agreements.

The move will solidify a truth that’s been pretty visible for the last six months: LTE is where most investment focus will be in 2010 through 2012, so having a strong position there will be critical. LTE will accelerate disintermediation of operators, however, unless it’s coupled with a rational service-layer strategy.

CA/NetQOS deal shows OSS is hot and getting hotter

If anyone doubted that OSS/BSS was getting hotter, the deal by CA to acquire NetQOS should put that doubt to rest. Telcos have two basic issues to face in the coming years: 1)They have to control operations cost growth, especially for individual new services, and 2) they have to create effective service-layer solutions.

The NetQoS deal gives CA the latter, and CA has assets in the systems management area that might be at least turned toward service application fulfillment. This space is gaining momentum quickly but there’s also probably a broader push than the real opportunity justifies.

Some later players will likely get burned here, and there are sure to be a lot of superfluous announcements too.

Service-layer evolution: Pushing for vendor support

ATIS, a body driven primarily by the service providers, has announced its own initiative for what it calls the Service Oriented Network or SON. While nobody is positioning this explicitly as a repudiation of either the vendor support for the service layer or standards progress in defining standards there, we’re hearing that it’s both.

Operators have been disenchanted with the response of vendors to their pressure to develop flexible solutions for hosted service features to let them compete better with OTT players. They’ve also been unhappy with the debate and dallying in the standards area. Now they are apparently launching a thinly veiled threat to drive the process themselves.

We’ve also heard that at least two and as many as four vendors will announce service-layer strategies/products this fall.