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With Ciena NFV, pay-as-you-go enterprise network services

Ciena's new NFV platform and virtual network app marketplace is paired with a radical billing system to let service providers offer pay-as-you-go, on-demand enterprise network services.

Ciena has launched an NFV platform with a flexible billing system that will let service providers offer a catalogue of on-demand virtual network services in a "pay-as-you-earn" business model.

Ciena's new Agility Matrix is a virtual network service creation platform that will be linked to a virtual network function (VNF) marketplace. Enterprise customers will use a portal to choose their network services, and then service providers will be able to charge for those services in a number of ways -- per minute, by the hour, per session or by a specific set of data, for example.

Ciena's platform will act as a clearinghouse of sorts, bringing together VNFs from a range of vendors that can be offered by any managed service provider. Meanwhile the platform will address licensing and billing for both service providers and VNF vendors.

"Network managers would like to consume as much or as little of the network as they need … but there is a gap between what enterprise customers want and what service providers can offer today," said Francois Locoh-Donou, senior vice president, Global Products Group at Ciena Corp. "That's what we call the agility gap."

As a technology, NFV could address that gap -- enabling the dynamic provisioning of virtual network services on commodity servers within minutes instead of months. Service providers hope to use NFV to find new lines of revenue from these services during a time when the wire-line business has gone flat.

Until recently, many providers believed they might need to implement SDN before they could make NFV work, but Ciena's Agility proves that wrong. Ciena has, in fact, made strides in developing its SDN Multilayer WAN controller, but Agility will initially work with legacy networks.

"[With Agility] you are doing some level of SDN because there is dynamic linking and interconnection that is created by the platform. You are creating service chain paths with the VNFs," said Eric Hanselman, chief analyst at 451 Research. "But you don't have to have this big OpenFlow environment or NSX in place to use it. The platform does the software configuration of the interconnections, but you can have a traditional physical network on either side of this."

Rise of the 'telco app store'

The Ciena VNF Market will incorporate VNFs from an ecosystem of qualified vendor partners.

Ciena is starting with five VNF partners: BlackRidge Technology for TCP security; Brocade for its Vyatta vRouter; Certes Networks for encryption; Silver Peak for WAN optimization; and Spirent Communications for performance testing tools.

Eventually the ecosystem will expand and become a "best-of-breed network function catalogue," said Kevin Sheehan, vice president and general manager of Ciena Agility, the company's newly announced SDN and NFV business division.

For now, Ciena has chosen the right kinds of vendors and VNFs to address the needs of service providers and enterprises, but it'll have to expand its ecosystem swiftly to remain competitive, said IDC research manager Nav Chander.

"You're going to see a lot of companies enter into this open ecosystem with a telco app store. Ciena is further ahead than other vendors trying to do the same thing," said Chander. "But this list of [vendors] will not satisfy all of the service providers."

Many tier one and two service providers already have relationships in place with network service vendors. They will want the ability to maintain those relationships through the Agility platform. On the other hand, the limited ecosystem may make things simpler for smaller providers, he added.

How OpenStack orchestration could alter service provider billing

NFV platforms and app stores are exciting, but the real differentiator for Ciena is the consumption-based billing model.

Ciena has tackled the billing issue by applying OpenStack orchestration through a tool called the Ciena Agility Director, which automates service creation, licensing and billing in an integrated way. The idea is to apply various methods of billing to services as they are consumed -- hence the Ciena slogan "pay as you earn."

"What I think is interesting is that they want to be the single point of contact -- to be like a broker for pricing and licensing. I think that's pretty bold," said Chander.

Ciena's orchestrated billing and licensing model addresses a major problem that other NFV ecosystems haven't -- the ability to make revenue simple and clear for VNF vendors, explained Hanselman.

"This isn't just an ecosystem of Barney agreements -- I love you, and you love me," he said. "Ciena is managing that licensing and revenue recognition piece … they can give direct revenue to the VNF provider."

Meanwhile, it's questionable whether Ciena's Agility will actually be able to navigate the stormy field of service provider billing and management. Many tier one and two carriers have homespun OSS/BSS tools that are rigid and difficult to integrate with other systems.

Hanselman said Agility has open APIs so that it can be bolted onto existing billing and management tools.

But it may take more than that for true integration, Chander said.

"Who is responsible when something goes wrong with an SLA?" asked Chander. It's unclear if that would be the VNF vendor, Ciena or the service provider. Ciena is already working with service providers like AT&T and CenturyLink that are moving toward programmable networks, so the company is likely tackling the back-end issues as it navigates these partnerships.

Let us know what you think about the story; email Rivka Gewirtz Little, or follow her on Twitter.

Next Steps

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Where NFV and SDN meet

NFV requires a new network management model

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