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SONiC OS continues to be hardened for data center deployments well beyond the hyperscalers

2/24/2021

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SONiC has gained popularity, and development efforts accelerated throughout 2020, despite the lack of travel and face-to-face interactions from COVID-19 restrictions.  2020 saw the incorporation of more features and excitement amongst suppliers and customers.  SONiC now has more advanced features and functionality and continues to be hardened for data center deployments well beyond the hyperscalers.  Advanced functions like BGP and RDMA are supported.  SONiC also added many hours of production traffic under its belt as we estimate over 100,000 switches running SONiC at the end of 2020.

SONiC is a Linux-based open-source networking operating system with its roots in the open community and Microsoft as an original contributor.  Today it has over fifty member companies and thousands of individuals contributing.  It has reached a critical scale beyond Microsoft’s internal use within Azure.  Increased vendor and customer contributions help increase the appeal of SONiC, and our end-user interviews indicate strong interest in several enterprise verticals, more than just the typical financial services sector.
Disaggregation is a trend here to stay with customers evaluating the ASIC, physical switch, optics, and operating system separately.  What was standard with full decoupling at the hyperscalers is making its way down to more traditional cloud and enterprise customers.  True to its open-source Linux roots, SONiC leverages the strength of the community, is beneficial financially to vendors both large and small, and also creates an ecosystem of support and career advancement for individual member contributions.  SONiC’s recent developments time well with a renewed interest in disaggregation.  This is important.  SONiC is being embraced not only at the system level via system vendors but at a Silicon level and in a market of millions of customers, not just a few hyperscalers.  Broad-based support can make SONiC meaningful for the whole networking market.
SONiC deployments increased in complexity as well.  Vendors showcased SONiC working on modular switches, modular routers, as well as the disaggregated chassis. The 2020 releases and future roadmaps continue to add critical enhancements to automation and telemetry.
As we look towards 2021, we see increased adoption of SONiC in Tier 2/3 Cloud providers.  We expect more enterprises to move parts of their network to SONiC.  More contributions from traditional enterprise suppliers and the community will create even more trust in SONiC.  With the disaggregation of switch hardware from the software, we believe SONiC will also see the benefit of accelerated hardware and software development in 2021.  The industry might not observe this directly because of the rapid move from 3.2 Tbps to 12.8 Tbps to 25.6 Tbps switches.  Still, as switch ASICs rapidly hit the market with faster pipes, more programmability, and massive amounts of telemetry data, the industry needs disaggregation and increased development velocity to keep pace.
Beyond 2021, SONiC could play a significant role beyond the data center; edge computing and networks built to support AI/ML seem like good targets, and we are closely watching developments outside the data center as well.



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Extreme Networks Investor Day Highlighted Cloud-Managed and 5G Themes

2/23/2021

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Extreme Networks held its investor day and highlighted multiple themes.  The company highlighted its Networking-focused Cloud-management capabilities, its large addressable market, how the company can benefit from the 5G market and its pivot to growth markets.  CEO Ed Meyercord addressed Cloud, 5G and artificial intelligence themes.  For us, we thought that Extreme's focus on 5G was new and incremental to what the company has talked about in past presentations.  And, of course, Extreme's playing up its market position in Wi-Fi cloud-managed services makes sense because this trend has been growing and Extreme is ranked second.  We see cloud-managed services as a continuing growth trend for the next several years and we highlight these details in our WLAN and Campus switching research programs.
Meyercord explained that as workers, data and computing become increasingly distributed, cloud-managed networking becomes critical.  Meyercord cited 650 Group research confirming that Extreme CloudIQ revenues rank number two in the industry.  The company cited a $26B total addressable market relating to Enterprise Networking and a $3B addressable market associated with the Service Provider market.  The company cited that the 5G market is expected to benefit Extreme Networks, explaining that 80% of the Mobile RAN market will be 5G-related by the year 2025; it cited that 5G-related is a "longer-term growth opportunity".  Extreme sees its next fiscal year will be at least in part driven by: (a) taking share in high-growth networking industry segments, (b) cross-selling and driving cloud-adoption (it cited 5M installed base but only 1.5M cloud installed base), (c) new product introductions such as Universal Platform and Co-Pilot Artificial Intelligence (AI).

Extreme invited Major League Baseball to its investor day.  We were encouraged to hear that MLB sees that 5G and Wi-Fi 6 are complementary, as opposed to competitive.  This debate about two of the main types of wireless has been very active and an important industry player like MLB confirming that it sees the two as complementary validates our own view that Wi-Fi and cellular play together well.


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The SASE Market Is Poised For Growth

2/12/2021

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This week, we published our Secure Access Service Edge (SASE) Forecast and Research report, a deep analysis on the market, the key players, and the opportunity that lies ahead for it. We expect SASE revenue to grow more than 500% by 2025. As a result of strong market growth, we also expect a tremendous opportunity for new vendors to stake their claim in this increasingly complex environment. As the SASE market is at a relatively early stage, many vendors are introducing new products and services to the marketplace, many of which can be considered “best-of-breed” offerings.
 
We think enterprises will be navigating multiple priorities, shifting between the needs of their security teams and their networking teams. As enterprises shift toward Zero Trust and SASE architectures, they are increasingly evaluating and deploying multi-vendor cloud-delivered security services, and it is not currently necessary for all the SASE elements to come from a single vendor. For example, HPE Aruba (Silver Peak) offers freedom of choice through a best-of-breed multi-vendor partner ecosystem. HPE Aruba’s approach is reinforced by the hundreds of deployments they have alongside cloud-delivered security services from partners like ZScaler, Netskope and Check Point. Enterprises working with vendors like HPE Aruba, with a multi-vendor partnering strategy, should be able to continue working with vendors they have worked with already or be able to pick “best-of-breed” systems.
 
The news media has featured our research, and the reports have had interesting takes, for example a Dark Reading article, SASE Surge: Why the Market Is Poised to Grow, focuses on the significant growth opportunities for the market. 
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Rakuten Mobile Reveals Future plans

2/4/2021

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In a briefing with Rakuten Mobile today, we learned two neat things:  It is experimenting with 3GPP on satellite, and it hopes to announced a full-stack Rakuten Communications Platform (RCP) customer as early as next quarter.  The company also shared some plans that it has for improving coverage to 96% by the end of the summer '21, and that it believes it has a 50% total cost of ownership advantage for its 5G infrastructure versus a traditional network operator.

So, what's so important about "3GPP on satellite?"  If satellites are able to communicate with all cell phones and other cellular devices, this would mean that coverage could be enabled where we might need to have placed macro base stations.  If we don't need macro base stations everywhere as satellites provide that coverage in sparse areas, or maybe even along highway routes, then a future cellular operator might be able to build its network with far fewer macro towers and rely more on a "barbell" approach, with small cells providing high throughput in busy areas and satellites providing coverage between busy areas.  This would reduce demand for 5G base stations.  Rakuten expects that its satellite partner, AST, may offer satellite coverage for Japan at the end of 2023 or the beginning of 2024 - that is a ways off.  But, this means that in 3 or so years, the need for base stations may be considerably reduced.

Also, Rakuten spokesperson, Tareq Amin, said he thinks it is possible that Rakuten may announce its first RCP customer as early as next quarter.  We published about RCP in November 2020, around when the team first started making RCP known to the public.  This means that a division of a mobile operator, Rakuten Mobile, may be selling its know-how, technology and services to another telecom operator, presumably outside of Japan.  This is a big deal in that most operators buy from vendors and systems integrators, not from others who are in the same business as them.  It is also a big deal because cloud companies like Amazon, Microsoft and Google all want to sell their cloud services to operators, too.  And, if RCP gets there first, and sells its full stack (radio, core, billing, orchestration, OSS) it would represent a first-ever full stack services deal.  
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650 Group Interview about 60 Ghz Wireless Market and a Follow-Up about Throughput and Range

1/21/2021

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Yesterday, analyst Chris DePuy joined Water Tower Research analyst John Roy in a discussion about the 60 GHz wireless market.  If you want to learn more about this emerging market, please listen in to this 30 minute interview about 60 GHz.

During the interview, John asked Chris about how fast and far 60 GHz systems can go, and Chris cited some information from Facebook Terragraph's experiences with Fixed Wireless Access (FWA) deployments in Europe.  Coincidentally, Chris received an email from Ubiquiti, an equipment vendor in the 60 GHz market, in which Ubiquiti cited recent 60 GHz results about a contest it is holding with users of Ubiquiti's new 60 GHz Point to Point (P2P) product.  The results shared in this email (dated Jan 21, 2021) are stunning, with 60 GHz P2P ranges of up to 17.87 km and throughputs as high as 1.62 Gbps.  
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650 Group Take: Juniper’s Announced AcQuisition of Apstra - A Move to Software, Day 2 Operations, Automation

12/16/2020

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On December 7th, Juniper’s announced its plan to acquire Apstra.  The deal is expected to close in 1H'20. 

Apstra, founded 2014, boasts numerous customer success stories in large enterprises, service providers, and even reaches into the mid-sized customer segment.  Cutting down complexity by automating data center operations is an immediate challenge that many customers need to solve now.  As such, our first thoughts quickly ran to Juniper Mist with even more data that could head into Marvis for AI and automation. 


Digging deeper, we see Juniper benefiting from additional software in its portfolio.  Apstra will help automate networks, saving time in Day 1 and Day 2 activities, and push Juniper towards automation at a faster pace.   We see the two as complimentary at both a hardware (PTX, QFX) level and a software level (JUNOS, Contrail).  Apstra has many advanced features needed by operations teams, and so the acquisition gives Juniper a leap in time to market for their customers.

Apstra already has strong hooks into SONiC, VMWare, and other software platforms and will benefit from Juniper’s larger channel and product portfolio.  We also see the acquisition helping beyond the traditional enterprise data center market.  Telco SPs, Cloud, and other large-scale customers can benefit from the current combination and deeper integration that can occur by owning the technology directly.

650 Group's end-user interviews indicate that automation and the day two activities associated with more application, multi-cloud, and more applications are significant concerns.  Organizations aren’t given more people for the increasing amount of applications and devices on the network. 

Contrail Enterprise Multicloud and Apstra AOS will significantly help improve these pain points today and automate operations to help improve the user experience and IT efficiencies.


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December 16th, 2020

12/16/2020

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Aruba HPE Expands CX Data Center/Campus switch Lineup — Intros Fabric Composer

12/10/2020

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tAruba HPE has taken a forward thinking approach to data centers and virtualized infrastructure while rounding out its solutions.  Extending Greenlake into the campus and extending Aruba into the data center.
 
The company this week has added new entrants to its family of CX Ethernet switches for Leaf and Spine network deployments in addition to advanced management and automation capabilities from its new Fabric Composer to address the modern problems of data centers.  

According to Aruba, data centers have become “centers of data,” meaning that application support and workloads are much more dynamic than in the past and can be situated at the edge, within traditional data centers, or in the cloud. Thus Aruba’s new CX switch entrants are now available in smaller and more flexible form factors, such as a 12 port collapsed compute core or small spine switch addressing smaller data centers on campuses . The new CX 8360 switch models offer a unique form factor for right sized environments. The flexibility enables customers to pair redundant 12 port switches to connect leafs.  We view this class of product as an area of growth as enterprises deploy many different edge models that rely on smaller data center footprints distributed in campuses and various different edges.

Aruba HPE now helps infrastructure and network operations teams to automate fabric provisioning for sped up network deployment, while minimizing repetitive tasks through workload orchestration.  Aruba has announced its fabric composer, with technology stemming from its earlier acquisition of software defined player Plexxi. 
 
The new Fabric Composer is a significant piece for data centers to operate at scale, putting Aruba HPE in much better position against its core competitors, namely Cisco and Dell.  The Aruba approach to its fabric composer was to keep it both lightweight and simple. The composer allows enterprises to streamline network operations, while handling virtualized workloads/VXLANs, all while minimizing manual configuration tasks. 

 
Aruba's latest data center enhancements complement the work that has already accomplished, namely Aruba’s single pane of glass management, its Cloud Central, ESP  with AIOPs to predict problems across the network using AI, and its existing network customization and configuration tool sets, e.g. Net Edit.


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Disaggregated SP Router Market – Strong Market Adoption as we head into 2021

12/8/2020

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Disaggregation has been around in the networking space for nearly a decade, especially in hyperscalers data center Ethernet Switches.  The insatiable demand for bandwidth, control, and cost reductions drove the white box from the Google science project to the dominant consumption model for Ethernet Switching in the hyperscalers.  The high-scale SP Router market has lagged.  Broadcom’s launch of Jericho gave the industry its first truly merchant ASIC, with companies like DriveNets providing the operating system, networking services and orchestration to create the compelling solution and ecosystem. 

Traditional Routing Doesn’t cut It
Up through and including the current generation of 100 Gbps based routers, the western market had to choose between three options (Cisco, Juniper, and Nokia), all vertically integrated with little flexibility other than a service provider having multiple vendors deployed to keep pricing pressure and innovation moving.  Cloud providers might have done the same thing; however, the price points, port density, and availability of products were not where they needed to be.  Can you imagine the Cloud today with 4-8 ports of 100G per box and $10,000 price points per port over millions of ports?  It just would not have worked financially or space/power-wise to continue down that path.  The Cloud, without legacy infrastructure, became a market dominated by ASIC capabilities and software, and branded system vendors have been playing catch-up ever since.

High-Scale Network Transformation to Disaggregation
As Telco SPs become more cloud-like in design and procurement and we enter the next wave of product availability, there is a tremendous opportunity for the high-scale router market to go through its own disaggregation transformation.  Our end-user interviews indicate a strong preference to move in this direction during the next two product upgrades (400 Gbps x56 Gbps SERDES and 400/800 Gbps x112Gbps SERDES).
While hyperscaler Cloud providers will fully embrace SP Router disaggregation with the 400 Gbps upgrade cycle starting next year, the rest of the Cloud and traditional SP industry is not that far behind.  Disaggregated routers with OS, ASIC, and optics purchased individually and potentially from multiple suppliers will become more common - both 1RU routers used at the edge as well as larger high-scale routers used for core and aggregration that are based on clusters of white boxes.

Disaggregated Routing Growth
We expect the market for Disaggregated Routing to grow substantially during the next several years as RFPs and plans turn into production traffic and revenue (Figure 1), replacing traditional routers.  Disaggregated routing and the consumption model associated with it will become a significant portion of the Router market over the next several years and create a significant opportunity for vendors that embrace the transformation.

Disaggregated Routing Market Players
Several vendors, including Cisco have entered the disaggregated routing space.  Another contender is DriveNets, a startup who’s software is used by AT&T to build a disaggregated core network. The highest-scale backbone in the US is now running on a disaggregated network model.



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Rakuten Communications Platform update

11/13/2020

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In conjunction with its recent Rakuten earnings call this week, Rakuten Mobile disclosed some more of its plans.  This mobile operator is becoming a telecom vendor.  Specifically, it said that “by expanding the Rakuten Communications Platform (RCP) globally, Rakuten aims to evolve from a Japan-headquartered tech company to a global leader in telecom.”  We see this as an explicit statement that the company plans to sell its telecom software and related services to operators worldwide.  For instance, Rakuten Mobile just announced a partnership with Saudi-based operator, stc.  This move pits Rakuten against Microsoft (who just acquired telecom companies and runs a cloud), Oracle (who runs a cloud and made telecom company acquisitions), and the rest of the telecom industry (traditionally Nokia, Ericsson, Huawei, ZTE, Amdocs, Netcracker and others). 

In offering RCP to other operators around the world, its unique value, as we see it, is that Rakuten has successfully built an LTE and now a 5G network based on Open RAN.  What we find interesting is that the company has developed a significant amount of intellectual property in-house or through technology sharing.  In an interview today with Tareq Amin, Rakuten Mobile executive, we asked what technology has been developed in-house by Rakuten.  Here’s what we learned.

  • OSS (it acquired OSS vendor, Innoeye May 2020, which has sold to 20 other operators)
  • BSS (developing in-house; expected completion by April 2021)
  • Orchestration
  • Radio software (it owns a substantial share of Altiostar)
  • Cloud IP.  It cooperates with robin.io and has added significant services mesh, CPU-related optimizations, for instance
  • Systems integration to make its “pods”
  • Core.  It works with NEC on 5G Core and has access to its source code

Some other components are not developed by Rakuten (the radios come to mind), but this is an exciting development.  RCP would be delivered as a “private cloud” on the premises of carrier customers (partners).  The terminology Rakuten is using for this “private cloud,” is it’s a “pod.”  RCP’s plans are a very interesting development in the industry.

There is one more thing.  Rakuten said it is working with a technology supplier that will sell Rakuten a server card that would allow a combined router and RAN processing function to co-exist on a server.  Today, the servers it uses to support its Open RAN radios use an FPGA NIC.  These servers can support up to 16 base stations.  We see the addition of routing to this card as an extension of the capability – but it means there may be a diminished need for cell site routers. 
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