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Software-defined networks can provide improved economics and increased control.

Software-Defined Networks Can Provide Improved Economics and Increased Control

The following is presented to give the average telecommunications industry participant, whether vendor, customer or interested observer, a better understanding of software-defined/ virtual private networks (SDN). It will do so by giving the reader a brief, simple explanation of an SDN and by comparing it to a known entity: private networks. We will then review the history of the SDN, allowing us to understand why these networks are here, what the current environment in the network arena is, and what a user's options are. In addition, we will take a look at who will be using SDNs and who will be providing them. Finally, we will discuss the future of these virtual network offerings and just how one will be able to determine which offering best fits his/her company's telecommunications requirements.

Whenever one tries to explain a new product or product enhancement, that person generally compares it to the product people are most familiar with and/or the product the new offering is attempting to displace. Therefore, I find it necessary to start by elaborating the difference between an SDN and a private network.

Private networks, like AT&T's ESPCS and SBS's CNS-A, are comprised of transmission and switching systems and services dedicated to the internal communications requirements of a single corporation. These offerings are typified by dedicated access and long-haul transmission lines (paths) to carry on-net traffic while overflow and off-net traffic utilize switched public media. The costs associated with these offerings generally allow only the corporation's largest locations to be served; an average private network only addresses 30 to 50 percent of a corporation's traffic.

In contrast, an SDN is a transport, switching and management service provided on a public switched network that is the functional equivalent of a private network. With these virtual network offerings, both on-net and off-net traffic traverse the carrier's switched network. Dedicated or switched access may be used to connect the user to the carrier's intelligent network nodes. It is these intelligent switches that allow the SDN to provide, via software, the same features and functions as a private network. Although the architecture may vary, as we will see in a few moments, the ability to define a customer's network via a software data base makes the SDN, and the switched network it utilizes, appear to be dedicated to a given customer's needs. The current interest by users in virtual offerings can be attributed to two factors: the shift in attitude by carriers to permit end-user access to the data base that controls the SDN, and the potential cost savings that switched service offers versus traditional dedicated networks.

Now that we've established what it is a software-defined network does, let's briefly examine how it provides these capabilities. To date, there are primarily two system architectures that SDNs will utilize: a network control point (NCP) architecture utilizing a central data base and common-channel interoffice signaling (CCIS) for call setup, or an interexchange carrier (IEC) switch-based architecture.

The NCP architecture stores all the information, such as call routing and authorization codes, about a given customer's network in a central data base--the network control point. When a call is made, it is held momentarily while the signaling network accesses the NCP to initiate the call's processing. The network control point will verify call authorization, do any necessary number translations (7 to 10 digits), and select the call's routing. The use of an out-of-band signaling scheme reduces a call's holding time from 10 to 20 seconds to one or two seconds. AT&T's SDN and MCI's Vnet will both utilize a network control point architecture.

The IEC switch-based architecture programs a customer's information into the software of the switches in that given customer's network. The loading of information is generally done on a central data base and downloaded to the applicable switches in the customer's network. Satellite Business Systems' SNS, US Telecom's VPN and Western Union's SDNS will each utilize this switch-based approach.

Neither of these architectures are clearly superior, but each will prove capable of performing the necessary functions in order to provide a software-defined network.

The economic advantage of SDNs over private networks can be seen after a quick study of divestiture economics.

Prior to divestiture, the short-mileage circuits used as access lines to private networks were priced artificially low due to subsidizations. Pre-divestiture saw long-mileage circuits subsidizing short-mileage circuits and interstate revenues subsidizing the local exchange plant. Without these subsidies, the local operating companies were forced to fend for themselves. This has resulted in increased pricing for shorter mileage circuits; in some instances the increase has been as high as 400 percent. These higher access costs, combined with the fact that only the largest locations were included in a corporation's private network, caused the economics of private networks to diminish. A private network's need for high volumes at each site generally causes these networks to have a small number of nodes, allowing the network to carry only a minority of the corporation's traffic. The divestiture effected an increase in the cost of the present traffic and made it nearly impossible for the communications manager to extend his private network to smaller, more-distant corporate locations.

The Current Environment, after Divestiture

Due to the effects of divestiture, private networks are now dealing with the same economics as carrier networks. The volume sensitivity of networks then dictates that private networks will be, by and large, more expensive than carrier networks. Therefore, a window of opportunity exists for both carrier and customer.

The carrier can clearly see the need for a "private-network-like' offering to meet the new requirements of the traditional private-network user. Moreover, if the carrier creates a product that offers the economics of the largely efficient carrier network with private network functionality, he can address not only current network customers but also prospects who had network requirements who could not previously justify the expense of a private network. The carriers (AT&T, SBS, MCI, US Telecom and Western Union) have filled this network need with their software-defined network offerings.

The customer can take advantage of similar functionality with carrier-network economics and gain control of a larger portion of his/her company's traffic. Since the transport between switches does not need to be dedicated, it is easier for the telecommunications manager to increase the number of locations connected to the network. Therefore, all of the SDN entries have a good number more points of presence, allowing the customer to decrease access costs and increase network control. Outside of lower access costs and added control, a larger number of locations works to reduce overall cost, seeing as how most of the SDN offerings have some sort of volume discount. Some of the offerings allow other than dedicated access, allowing the communications manager to include even the smallest, most-remote locations in the network.

Advantages, Drawbacks of Software-Defined Networks

In addition to the improved economics and increased network control, SDNs offer the following advantages:

Flexibility--With a software-defined network, changes can be implemented quickly, and in some cases overnight. Routing changes and user authorizations can be changed daily if so desired. The time it would take to extend the network to other locations would be only as long as it takes for the local telco to install new access lines. In either case, the changes can be implemented in a fraction of the time it would take in a traditional private-network environment.

Higher reliability--If, in a private network, a dedicated line between point A and point B were to experience trouble, communications between these two points would halt. In an SDN, however, there would be literally thousands of backup paths available to carry traffic between A and B.

Lower capital expenditures--Unlike private-network offerings, the majority of capital equipment needed belongs to and has been capitalized by the carrier.

There are some concerns that have been expressed about SDNs that I feel are worthy of discussion:

Grade of service--There are some who will argue that using the public switched network increases the possibility of traffic being blocked, since the public network works on a contention basis. The likelihood of this, however, is extremely remote, considering that most carriers engineer their networks at P .01. In addition, a customer can still maintain any desired grade of service through the engineering of access lines.

Voice/data integration--While most SDNs claim to be a forerunner to an integrated services digital network (ISDN), there are still numerous issues that need to be resolved, such as uniform standards and user applications, before anyone knows exactly what an ISDN will be.

IntraLATA traffic--At present, the providers of SDNs do not have the authorization to provide intraLATA traffic completion. This may lead to the advent of smaller regional Bell operating companies (RBOCs) providing SDNs to address the smaller local network needs of a customer, or the use of private networks for local-area networking.

Backbone data, video--While using the public switched network to transport voice traffic is a comfortable notion, the idea of sending data or video signals over the switched network worries some communications managers. The proponents of this concern feel that data and video applications are more sensitive to switching, amplifications and delays, and therefore should be provided over the most sterile of environments: point-to-point.

Tl and WATS are still cheaper--In some cases, a dedicated private line between two points may still be less costly than using the switched network. The calling patterns may also cause, in an admitted minority of cases, public network offerings to undercut the SDNs' pricing. Each of these issues leads me to discuss just how an SDN will be used--exclusively or as part of a larger network arrangement.

How Will Software-Defined Networks Be Used?

We've uncovered some issues that would suggest that an SDN may not meet all of a customer's needs, including high-traffic paths and high-speed data. This leads us to the phenomena of hybrid networks. This arrangement utilizes the SDN where and when it is justified and uses other facilities in the instances where they prove feasible.

With a hybrid network, the customer would, via a regional switch, route traffic to the most-economical path. This regional switch could be anything from an intelligent private branch exchange (PBX) to a private network switch. (The diagram on page 38 illustrates what a hybrid network location might look like.)

The hybrid hub would route local traffic over FX facilities, an RBOC SDN, or a local-area network; high-volume point-to-point traffic over a high-capacity Tl facility; high-speed data and video over point-to-point digital facilities; and the rest of the traffic over an SDN. (The hybrid network would look something like the diagram on this page.)

The obvious advantage of a hybrid using an SDN as its backbone is that it allows all traffic to flow over the most-economical facility. The disadvantages associated with this almost-ideal solution are increased optimization care and the need for an intelligent hub. While the intelligence of the hub could be addressed by carriers allowing the SDN switch to perform this function, it is unlikely this will appear in the immediate offerings. As for the increased optimization care, the communications manager would have to constantly monitor traffic patterns and the alternatives available. Most communications managers do not have the resources to accomplish such a task. However, it is advantageous to pursue this arrangement to whatever degree a communications department can.

The differences between the SDN offerings today and the traditional private-network offerings will expand the customer base that would benefit from a network arrangement. As a benchmark, the new SDN offerings will be best suited for companies with more than five locations, with some community interest between locations, changing traffic patterns, and a willingness to accept a long-range plan.

Five Carriers Currently Offer SDN Serices

Five carriers currently in the SDN arena are AT&T, SBS, US Telecom, MCI and Western Union. Of all these service providers, only two are currently providing service to other than themselves. SBS has had an operational SDN for more than one year and is currently serving 16 SNS customers. US Telecom is also providing its VPN service to non-beta customers, and to date has gotten positive reviews. MCI's Vnet and Western Union's SDNS are both basically in the design stage, although each is undergoing an internal beta test. AT&T has signed three prestigious beta customers and has just received FCC approval to go forth with its proposed SDN offering. At first, AT&T's filing was suspended by the FCC for several reasons; however, the recent approval of the offering puts AT&T officially in the SDN market and at the head of the pack in some people's minds.

As presently stated, the offerings of all the carriers provide the same basic services, such as on-net (seven-digit) calling, off-net calling, traffic reports and tapes. The key to the future success of these offerings lies in four areas: transmission media, points of presence, alternative methods of access and network information management systems.

Transmission media--There are almost as many different types of transmission media being used as there are SDN providers. However, all are claiming to be investigating, and some even implementing, fiber optics. The advantages of fiber optics are clearly obvious, and the carrier with an abundance of fiber capacity will find itself with a large market share.

Points of presence--The number of nodes at which a customer can access a carrier's SDN is crucial, as evidenced in our previous discussion on increasing access-line prices. As of now, the clear leader in this area is AT&T, with more than 800 points of presence covering all but two LATAs in the United States.

Alternative access--Alternative methods of access can act to extend networks to the most-remote customer locations. The stronger SDN offerings would include not only dedicated access, but switched (950-10xx; 1 dialing) and high-capacity access arrangements as well. Those carriers that will work with the customer to create economical direct network access (by-pass) will find themselves further ahead on this issue.

Network information--The amount of network visibility will be the most crucial of the above. While the first three issues address mainly economics, this provision will give the customer control of what his/her network will be. Reports on a monthly basis will no longer be critical if a customer can access a data base from a terminal at his/her desk and reconfigure the network on a near-real-time basis. I have no doubt in my mind that the carrier that provides this capability extensively and correctly will own the SDN market for a long time to come.

The advantages of an SDN are clearly worth pursuing, but one must exercise care in doing so. One of the underlying caveats to the success of an SDN is giving one vendor the large majority of your traffic. Therefore, the communications manager should look beyond today's SDNs and investigate the carrier's future SDN plans, paying specific attention to the four areas outlined above. In addition, the communications manager should also investigate more than the price/call-minute, as there may be several hidden costs, such as sign-up fees and private network interface charges associated with some SDN offerings. Finally, if a hybrid solution is called for, you should choose a carrier that can meet all your needs with a full spectrum of service offerings.

Photo: Hybrid Location

Photo: Hybid Network
COPYRIGHT 1986 Nelson Publishing
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Copyright 1986 Gale, Cengage Learning. All rights reserved.

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Author:Finan, Thomas
Publication:Communications News
Date:Apr 1, 1986
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