Summary Bullets:
- AT&T’s Domain 2.0 vendor roster now stands at eight publicly announced participants; the operator has essentially created its own de facto ecosystem.
- How AT&T plans to use each vendor has not been announced. Regardless, substantial coordination among the participants will be required.
AT&T spent 25 billion dollars on CapEx last year. Just to put that in perspective, if AT&T was a country, its CapEx alone would be in the top 100 of global GDP. There were several countries smaller than this in the recently concluded World Cup tournament.
The obvious implication in this (marginally fallacious) analogy is that when you throw around that type of money, you get to call a lot of shots. In the case of AT&T’s Domain 2.0 program, the operator is essentially writing the proverbial “playbook” on how to design and source a comprehensive SDN/NFV network strategy. Now, to be fair, other carriers are being aggressive too. Telefonica, for example, is driving its own vision via the so-called UNICA architecture. NTT is driving its own vision through its cadre of virtually in-house suppliers. Nevertheless, at least from a PR perspective, being included in AT&T’s Domain 2.0 project is clearly a nice reference for any network equipment vendor. So, far, the list of “winners” stands at eight:
- Affirmed Networks
- Alcatel-Lucent
- Amdocs
- Ericsson
- Fujitsu Network Communications
- Juniper
- Metaswitch
- Tail-f Systems (Soon to be Cisco)
As market analysts, we look to announcements such as AT&T’s most recent vendor inclusions to provide insights beyond which vendors will be cashing checks. More importantly, what we are trying to understand is what key operators are demanding in terms of technology and/or commercial platform offerings. Sadly for us, AT&T’s Domain 2.0 participant announcements have provided precious little in the way of clues to the latter.
That said, we know some things.
For example, we have recently polled operators on SDN/NFV solutions and found that a key purchase criteria is a vendor’s ability to “deliver end-to-end solutions.” The kneejerk reaction to AT&T’s Domain 2.0 supplier announcements, then, is that AT&T does not fit the mold: while other vendors are prioritizing end-to-end solutions, AT&T is developing its own. Yet, there is more to it than meets the eye. Specifically, it is broadly accepted that a key value of SDN/NFV will be to offer operators a way to source from multiple suppliers and dilute exposure to “vendor lock-in.” Against this back-drop, we believe that “delivering end-to-end solutions” will be much more important for most operators that do not fall into the “largest of the large” category. Another theme we have heard from operators is that they want suppliers that can coordinate an SDN/NFV ecosystem. Again, seemingly in contrast to the finding, ATT is not waiting for these ecosystems to coalesce. It is building its own.
Here’s where some important insights lie. In many cases, getting this many vendors to collaborate this closely on a commercial solution is not an easy task. In this case, we are looking at vendors of very different sizes, technology development and customer support capabilities, financial resources, strategic motivations… just to name a few. Logic says, this will not be easy. However, if a key value of SDN/NFV is that it will make it easier to mix and match vendors, then AT&T is certainly going to gain practical experience in making orchestration work across a multitude of vendors.
Daunting? Yes, but if anyone can pull it off, it is probably an operator that spends enough cash every year to buy a World Cup nation.