Virtualized Network Function (VNF), Virtualized Managed Services (VMS) and the transition to a software based infrastructure are poised to dramatically alter the way Service Providers build and maintain their networks . End users want value, innovative functionality, and reliability, and Service Providers seek to meet these needs at the lowest cost possible. The benefits of moving to a software-based infrastructure are incredibly compelling in meeting these demands, delivering lower OPEX, reduced reliance on proprietary & expensive hardware, and faster time to market with new services.

Today’s managed services landscape has become increasingly complex from a technology perspective. This complexity has placed stress on Service Providers whose business model is more and more reliant on managed services as a means of increased revenue and differentiation.  However, VNF completely changes how networks are designed, built and managed. It pulls the functions necessary to run networks off of the current proprietary hardware and places them on open-based computer servers that can be deployed in data centers close to where they are needed most.

As operators and their suppliers move from proof of concept & trials to real world VNF deployments, monitoring and testing challenges are beginning to rise to the forefront. With each additional deployment, Service Providers are facing a new set of challenges in assuring, monitoring, managing, and automating services & equipment that are newly virtualized. These challenges are prominent in the key areas of business processes, service assurance & support, service management & continuity, visibility blind spots, complex service chains, and multi-vendor environments. End users want performance and service quality, so network operators must ensure that the quality and performance in their virtualized environments are equivalent to that of their legacy physical environments.

VNF and VMS as a concept will simplify service chain provisioning by making it easier and cheaper to spin up applications in Enterprise and Service Provider networks. However, Service Providers need to invest significant CAPEX and OPEX to realize this vision, and they are reluctant to risk making large capital expenditures toward a new customer segment with cost control being vital. Investment challenges coupled with a skills gap in this area mean that Services Providers can struggle to rapidly launch VNF and VMS based technologies.

To overcome these issues and to deliver VNF and VMS in a timely manner, Service Providers have the ability to partner with Cisco Cloud & Managed Services to achieve their short and long term goals. One such offer, Managed Customer Premise Equipment (CPE), is a white-label service that enables Service Providers to rapidly launch and deliver VNF and VMS to their end customers. In this model, Cisco delivers provisioning, service orchestration, and assurance for a set of virtualized and physical services while the Service Provider brands the service and interacts with the customer. These services can reside in the Service Provider’s cloud, the end-customer premises or on Cisco’s Intercloud.

Cisco Managed CPE allows Service Providers to deliver the latest managed services offerings to small and medium sized businesses without the time and expense involved in developing a new service on their own. This shared risk model enables providers to replace up-front costs for a pay-as-you-grow model. Also, Service Providers can enable their customers to seamlessly order and provision services via a self-service web portal. This allows customers to directly order services without a complex and lengthy interaction with the Provider’s direct sales team.

Cisco is continually enhancing and adding new physical and virtualized features to Managed CPE to drive market adoption of advanced technologies as well as new managed service offers.  As new Cisco networking solutions are introduced, we will continue to provide robust support from a remote management and monitoring perspective to enable Service Providers to keep pace with new technology innovation while increasing value and creating additional revenue streams. The potential market for VNF and VMS for businesses of all sizes is massive. And with the right outsourced application and management services, Service Providers can seize this new opportunity by forging strong, lasting relationships with customers while building a foundation for future revenue.

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