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For service providers, virtual customer premises equipment, or virtual CPE, and software-defined WAN are distinct technology options that help achieve the same goal: to deliver managed services to business customers. As a result, providers face a tradeoff: rapid deployment with SD-WAN using a vendor-specific option versus the flexibility of a virtual CPE platform that allows open source contribution, customization and internal development -- with a longer timeline. Soon, however, there won't be a distinction between the two. The lines between these two technologies are beginning to blur as their functionalities merge.
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Many leading service providers are currently deploying both SD-WAN and virtual CPE services to their business customers. Over time, these functionalities will converge, with either SD-WAN functionality being incorporated onto the virtual CPE platform or SD-WAN expanding to become the platform for virtual CPE services. Many service providers, including AT&T and Verizon, are deploying both SD-WAN and virtual CPE as managed services offerings. Others, like Telefónica, are deploying virtual CPE-centric platforms. Many other service providers -- including CenturyLink, Sprint, Vonage, Hughes Network Systems LLC, Masergy Communications Inc. and Windstream -- are leveraging SD-WAN products for their business services offerings.
A breakdown of SD-WAN and virtual CPE
SD-WAN simplifies WAN service delivery using software and cloud-based technologies. Software-based virtualization enables network abstraction that results in simplified network operations. With SD-WAN, service providers can quickly deploy managed hybrid WAN services -- using internet and MPLS connections, for example.
Leading service providers are currently deploying a wide variety of SD-WAN services to deliver managed hybrid WAN connectivity to their business customers. SD-WAN vendors, including VeloCloud, Versa Networks, Riverbed Technology and Cradlepoint, are increasingly expanding their platforms' capabilities to include a broad range of security, WAN optimization and routing features that compete with virtual CPE functionality.
For service providers, virtual CPE is a leading use case for deploying network functions virtualization -- in which network intelligence is abstracted into modular software for deployment on standard hardware platforms. Service providers are deploying virtual CPE as a more flexible way of delivering services to business customers. These services virtualize CPE functions -- e.g., routing, network address translation, VPN or firewall -- and the functionality resides in the service edge or the data center. Leading service providers are now starting to deliver virtual CPE services to their business customers.
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