North American telecom operator Verizon has started the deployment of software-defined networking (SDN) technology to combine its service edge routers for Ethernet and IP-based services onto a single platform.
Investment in SDN technology will support Verizon’s strategy to improve EBITDA margin in coming years. Verizon posted EBITDA margin of 36.7 percent in the first quarter of 2018 against 37 percent in the first quarter of 2017.
Cisco Systems and Juniper Networks are assisting Verizon, the largest telecom operator in the U.S., for improving the operational efficiency of its networks while also adding increased functionality and flexibility. Cisco and rival Juniper Networks are the two leading mobile equipment makers for telecom operators.
Verizon, which reported capital expenditures (Capex) of $4.6 billion in in the first quarter of 2018, said this new multi-service edge solution features a disaggregated control plane and leverages external compute to enhance the capabilities of that control plane beyond that of a traditional router.
Simplifying the mobile networks’ edges allows Verizon to drive process improvements in the deployment and provisioning of infrastructure on its networks, as well as in customer-focused areas such as Ethernet, internet and VPN-based services.
“Software defined networking continues to improve network management and also enables us to be more nimble in the ways we serve our customers,” said Michael Altland, director, Network Infrastructure Planning, at Verizon.
“By decoupling the control plane from a carrier-grade provider edge routing platform and moving it to general compute servers, we can serve our consumer and enterprise customers from the same platform, while running our networks far more efficiently,” Michael Altland said.
Sumeet Arora, senior vice president of engineering, Service Provider Business, Cisco, said the new flexibility enables Verizon to develop and launch services for its customers faster, with improved efficiency.
Bikash Koley, chief technology officer, Juniper Networks, said “Next-generation services that require low latency and real-time response are moving closer to users at the network edge, creating new gains in performance and business agility.”
Verizon started the deployments on the Verizon IP networks in early 2018 and will continue through the end of 2019. This platform will eventually replace all of the legacy edge router functions within the Verizon networks.
Last year, Verizon announced its target to achieve $10 billion in cumulative cash savings from the business over the next four years. The company’s business excellence initiative, which includes implementing zero-based budgeting, has assisted the telecom operator to save $200 million in Q1 2018.