Momentum in the SDN and NFV markets is growing, but behind the expectations lie fundamental questions about how the technologies should be implemented.
An increasing number of deals are being signed between operators and vendors, either for field trials of virtualised technology, or full-scale implementation.
One of the latest was Telecom Italia, which has adopted Juniper Networks' MX Series router to act as a universal SDN gateway between physical and virtual networks. It is already using the vendor's Contrail SDN and NFV controller.
Mobile Europe travelled to Amsterdam last week to learn more about the deal and the obstacles that both operators and vendors need to overcome before SDN and NFV become a mass market reality.
David Noguer Bau, Juniper's Head of Service Provider Marketing, says there has been a change in the market during the past 12 months: "2013 was a year of education. There were some early adopters but most people were trying to understand it.
“This year is the year of early use cases. It could be a partial or real deployment but this is the year of people thinking 'let's play with it'."
Operators are convinced by the technology’s benefits because they can no longer afford to be as slow as they have been, he adds.
He cites how Amazon can deploy new products quickly but says that for a large operator like China Mobile it takes around six months to do the same thing.
The key drivers of virtualised technology for operators are elasticity of supply, total cost of ownership and agility, according to the Juniper Networks exec. But he warns: "Operators’ operations are too complex, infrastructure is too inefficient and services are really rigid."
Paolo Fasano, who works in data networks configuration for Telecom Italia, agrees: "Our network is quite static and it takes a long time to introduce new services.
"Today it's possible to do everything except [to] be quick and agile to new requests and responsive to the market. That's the real differentiation I find in this model."
Which suggests all is rosy for those building SDN and NFV solutions, but problems lie beneath the surface.
For example, Fasano believes there is a question about just how many functions you should virtualise in your network. He says an operator needs to draw a line somewhere but confesses he does not yet know where this line is.
Other concerns lie around just how mature the technology is and how much cost benefits it can actually offer an operator. Fasano explains: "We see the promise of the technology but a real assessment needs to be done that is more detailed and clearer."
The main problem is structural. Both Fassano and Noguer Bau agree there is a skills gap among telco staff for virtualised technology.
Another key issue is just who will take charge of the project? Is it the CTO or the CIO? Unless it wants to be hamstrung by internal politicking, an operator could face structural changes if they are going to use SDN, NFV or both to its full potential.
Fassano says: "We have a number of platforms and systems that we are organised into by segments. Groups are focused on different technology. If we are going towards an environment where all the hardware will almost become the same but the software will be different... our organisation will have to change dramatically."
And quickly. Telecom Austria announced this month that two of its subsidiaries have launched NFV trials in the packet core. Telefónica will have 30 percent of its network virtualised by 2016.
SDN and NFV could fundamentally change how operators work. It could also lead to serious change in how operators organise their own businesses.