Skip to main content

Network Virtualization will Advance the Telecom Sector

As new technologies continue to evolve, open network virtualization strategies are reshaping the telecom carrier ecosystem. The ongoing shift to cloud services and mobile internet technologies is driving service providers and their suppliers to improve their efficiency and agility.

According to the latest market study by International Data Corporation (IDC), network virtualization is set to revolutionize the telecom sector -- transforming the operational culture, as well as the fabric of legacy proprietary infrastructures that have, until now, dominated this industry.

Communication service providers (CSPs) and their vendors are embracing the demand for progressive network virtualization platforms -- such as open-source software-defined networking (SDN) and network functions virtualization (NFV).

"Despite budget concerns and questions about the ability to execute on the network virtualization vision, CSPs, telecom vendors, and partners are all embracing potential opportunities," said Elisabeth Rainge, research vice president at IDC.

IDC believes that network virtualization for telecom represents some significant challenges, but the upside is extremely high. Moreover, while not everyone will reap the benefits of this transformation, IDC sees an evolution of digital infrastructure that is already underway.

During the first half of 2014, a series of announcements provided concrete evidence of the maturity of network virtualization. Because ongoing discussions emphasize the long-term visions for various new technologies, and the larger concept of network virtualization, a clear picture of the activities can be somewhat difficult to discern.

Meanwhile, vendors will resort to network function virtualization and software-defined network architecture to catalyze use cases -- such as the voice over LTE (VoLTE) network evolution.

However, with the talk of moving away from a five-nines model in the name of service agility and flexibility, it remains to be seen whether and how NFV and SDN can ensure faster deployment while maintaining high standards of quality of experience.

Many existing CSP network elements, such as service provider routers, Ethernet switches, and packet optical switches, will transition over the next few years to become software-enabled and programmable with open, northbound interfaces.

IDC says that many networking vendors are already delivering their first generation NFV-based Virtual CPE solutions, and a number of leading CSPs will begin to launch commercial virtualized telecom services -- beginning in late 2014.

Popular posts from this blog

AI Supercycle: Server Market Growth Surge

The worldwide server market has entered a new phase defined almost entirely by artificial intelligence (AI) infrastructure economics rather than traditional enterprise refresh cycles.   The latest market data shows robust growth and a structural shift in where value is created, who captures it, and which architectures are setting the pace for the next decade. IDC reports that worldwide server revenue reached a record $112.4 billion in the third quarter of 2025, representing a striking 61 percent year-over-year increase compared to the same quarter in 2024. For context, this means the market is adding tens of billions of dollars in incremental quarterly spend, driven overwhelmingly by AI and accelerated computing requirements.  IT Server Market Development Over the first three quarters of 2025, server revenue has already reached $314.2 billion, meaning the market has nearly doubled in size compared to 2024, underscoring how AI buildouts have compressed several years of exp...