Do company partnerships work? Ericsson and Ciena certainly think so, and provide a compelling argument for their collaboration in the areas of IP-over-WDM and software-defined networking (SDN). More such partnerships should also be expected.
Jan Häglund
Ericsson and Ciena have signed a global strategic agreement that provides Ericsson with Ciena's optical networking technology, while Ciena benefits from Ericsson's broader service provider relationships.
In particular, Ciena's WaveLogic coherent optical processor will be integrated into a module and added to Ericsson's Smart Service IP routers, while Ericsson will resell Ciena's 6500 Packet-Optical Platform and 5400 Reconfigurable Switching Systems.
Both companies will also collaborate in developing SDN in the WAN, also known as service provider SDN or Transport SDN.
IP-over-WDM will grow rapidly, accounting for over 30 percent of the total market by 2020.
Ericsson says the IP market will reach US $15 billion and optical networking $10 billion in 2014. Jan Häglund, vice president, head of IP and broadband at Ericsson, says the two markets are not independent and that IP-over-WDM will grow rapidly, accounting for over 30 percent of the total market by 2020.
Ciena's motivation for the deal is somewhat different.
"We are focussed on packet optical convergence - Layer 2 down to Layer 0 - creating a scalable, cost effective WAN infrastructure for service providers," said James Frodsham, Ciena’s senior vice president and chief strategy officer. "We have been looking around our core value proposition, we have been looking to expand our distribution into geographies and customers where we lack presense." The deal with Ericsson clearly addresses that, he says.
There is now more to think about. It is a very interesting time.
James Frodsham, Ciena
The company also has a different view regarding IP-over-WDM. IP routers are a vital part of the network but for cost reasons they are better used in centralised locations, interconnected using packet optical networking, said Tom Mock, senior vice president, corporate communications at Ciena.
Working with Ericsson widens the network applications Ciena can address. "But our view of the prevalence of IP-over-WDM hasn't really changed," said Mock.
Tom MockEricsson and Ciena both highlight the changes taking place in the network, namely Network Functions Virtualisation (NFV) and SDN, as another reason for the tie-up.
NFV is turning telecom functions that previously required dedicated platforms into software that is virtualised and executed on servers. NFV promises to bring to telecom the benefits of IT and cloud computing, enabling operators to introduce services more quickly and scale them according to demand.
SDN, meanwhile, not only oversees such virtualised services, but also the network layers over which they run. This is where IP-over-WDM plays a role and why the two companies are working to develop Transport SDN.
It also gives us exposure to the Evolved Packet Core that is going into new wireless installations
Ciena's optical infrastructure and Ericsson's service-provider SDN and IP portfolio will result in a competitive solution, said Ericsson. "Combining the two network layers, and jointly making sure that the control protocol optimises the traffic network, will lead to CapEx and OpEx savings," said Ericsson's Häglund, in a company webcast announcing the deal.
Other benefits of the agreement include growing Ciena's relationships with services providers, especially in wireless. "It also gives us exposure to the Evolved Packet Core that is going into new wireless installations," said Mock.
Ciena also highlights Ericsson's strengths in operations and business support systems (OSS/ BSS). Ciena says the transition to SDN will be gradual. "That evolution is going to have to take into account OSS/ BSS technologies and having a partner that is strong in that area will help us both," said Mock.
Ciena believes more such industry collaboration should be expected. "We see that with programs like AT&T's Domain 2.0 Program, such thinking is also happening in the marketplace," said Mock. For the Supplier Domain 2.0 Program, AT&T is selecting vendors to provide a modern, cloud-based architecture that includes NFV and SDN technologies.
The collaboration between Ciena and Ericsson should boost their position as possible Domain 2.0 suppliers. "Both of us are suppliers under AT&T's current domain program, and as with any relationship, incumbency has advantages" said Mock. "The fact that we are beginning to collaborate on SDN-oriented applications ought to help."
Industry collaboration between telecom vendors and IT equipment providers will also likely increase.
"The data centre is a very important piece of real-estate in the future infrastructure," said Frodsham. The data centre hosts the storage and servers that manage the bulk of applications that pass across the network. Greater collaboration will be needed between telco and IT vendors to optimise how the data centre interacts with the WAN.
"There is now more to think about," said Frodsham. "It is a very interesting time."