NFV Projects & Standards NEWS

NFV Forecast to be Worth $11.6 Billion in 2019

By Paula Bernier July 21, 2015

The network functions virtualization market is poised to grow to $11.6 billion in 2019, which is more than five times its current value of $2.3 billion, according to IHS. And NFV software will account for more than 80 percent of the market’s 2019 value, according to the firm.

"The software is always a much larger investment than the server, storage and switch hardware, representing about $4 of every $5 spent on NFV," says Michael Howard, senior research director for carrier networks at the research and consulting business.

He adds that revenue from software-only video content delivery network functions will increase by 30 times between this year and 2019.

While the move to software-centric carrier networks seems to be moving quickly, the firm believes that the transformation to virtualized networks will take place over a 10-to 15-year window of time. The company also notes that revenue from outsourced services for NFV projects will grow at a 71 percent CAGR between 2014 and 2019.

Image via Shutterstock

NFV involves virtualizing in software specific aspects of the network related to functions like deep packet inspection and the HSS, as two examples. This new approach is expected to enable service providers to benefit from cost savings resulting from the use of industry-standard servers and should allow service providers to more quickly introduce new services and capabilities leveraging such infrastructure. AT&T, BT Group, Deutsche Telekom, Orange, Telecom Italia, Telefonica and Verizon got the NFV ball rolling a few years ago with the creation of an NFV group within ETSI and the publication of a white paper on NFV.

In a recent interview, Andre Fuetsch, senior vice president of architecture and design at AT&T, said that AT&T has already virtualized the evolved packet core of its cellular network, as well as DNS route reflectors, and components of its IMS architecture. 

Edited by Dominick Sorrentino

Executive Editor, TMC

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