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The Network Functions Virtualization (NFV) Market: Business Case, Market Analysis & Forecasts 2014 - 2019

The Network Functions Virtualization (NFV) Market: Business Case, Market Analysis & Forecasts 2014 - 2019

Network Functions Virtualization (NFV) is a telecom led initiative that aims to utilize standard IT virtualization technology to consolidate many telco network equipment types onto industry standard high volume servers, switches and storage. NFV involves implementing network functions in software that can run on a range of industry standard server hardware, and that can be moved to, or instantiated in, various locations in the network as required, without the need to install new proprietary equipment.

With a promise to drive significant CapEx and OpEx reductions, NFV is poised to transform the entire telco infrastructure ecosystem. Mind Commerce estimates that global spending on NFV solutions will grow at a CAGR of 46% between 2014 and 2019. NFV revenues will reach $1.3 Billion by the end of 2019.

This report provides an in-depth assessment of the global NFV market, including a study of the business case, technology, use cases, vendor landscape, and a quantitative assessment of the industry from 2014 to 2019.

The addresses the following key topics:

  • Key Issues in NFV: An assessment of key issues related to NFV
  • NFV Use Cases: A review of specific use cases for the Big Data market
  • NFV Technology: A review of the underlying technologies that enable NFV
  • The Business Case for NFV: An assessment of the business case, growth drivers and barriers for NFV
  • Vendor Assessment: An assessment of the vendor landscape of leading players within the NFV market
  • Market Analysis and Forecasts: A global and regional assessment of the market size and forecasts for the NFV market from 2014 to 2019
Key Findings:
  • Early NFV deployments will target virtualization of the mobile core (EPC) and IMS services
  • NFV IaaS will open a major opportunity for data center and cloud service providers to play a greater role in the telco services market
  • Mind Commerce estimates the NFV market to be worth $203 Million in 2014. Growing at a CAGR of 46 % between 2014 and 2019, NFV revenues will reach $1.3 Billion by the end of 2019
  • Companies with expertise in network virtualization technology as well as commodity hardware manufacturers such as Intel will significantly benefit from the commercialization of NFV
Target Audience:
  • SDN providers
  • Mobile network operators
  • Telecom infrastructure providers
  • Cloud and virtualized datacenters
  • NFV technology/solution vendors
  • Telecom service providers of all types
  • Digital content and application providers
Companies in Report:
  • Amazon
  • Azuze
  • AT&T
  • 6WIND
  • Alcatel-Lucent
  • Amdocs
  • BT
  • CIMI Corp
  • Cisco
  • Connectem
  • ConteXtream
  • Ericsson
  • F5
  • Google
  • Huawei
  • Intel
  • Juniper Networks
  • Meraki
  • NEC
  • NSN
  • Openwave Mobility
  • Oracle
  • Skyfire/Opera
  • Telefonica


General Methodology

Mind Commerce Publishing's research methodology encompasses input from a wide variety of sources.

We rely heavily upon our Subject Matter Experts (SME) in terms of their market knowledge, unique perspective, and vision. We utilize SME industry contacts as well as previous customers and participants in our market surveys and interactive interviews.

In addition, we rely upon our extensive internal database, which contains modeling, qualitative analysis, and quantitative data. We review secondary sources and compare to our primary sources to update previous findings (for prior version reports) and/or compile baseline information for technology and market modeling.

We share preliminary models with industry contacts (select previous clients, experts, and thought leaders) to verify the veracity of initial modeling. Prior to final report production (analysis, findings, and conclusions), we engage in an internal review with internal SMEs as well as cross-expertise, senior staff members to challenge results.

We believe that forecasts should be prepared as part of an integrated process which involves both quantitative as well as qualitative factors. We follow the following 3-step process for forecasting.

Forecasting Methodology

Step 1 - Forecasts Input: The inputs for the present and historical revenues are derived from industry players. Financial and other quantitative data for individual sub-market categories are derived from original research and tested with interviews with major industry constituents.

Step 2 - Forecasting of Future Years: Mind Commerce extends forecasts based on a variety of factors including demand drivers as well as supply side data. Key success factors and assumptions are considered.

Step 3 - Validation of Data: The final step is to validate projections, which is accomplished in consultation with both internal and external industry experts, including both topic and regional experts. Adjustments are made to the forecasts based on factors identified throughout this process.


1 Chapter 1: Introduction
1.1 Executive Summary
1.2 Topics Covered
1.3 Key Findings
1.4 Target Audience
1.5 Companies Mentioned
2 Chapter 2: NFV Technology & Business Case
2.1 Defining NFV
2.2 Why the Confusion between NFV and SDN
2.3 Taxonomy for NFV
2.3.1 Commercial off the shelf (COTS) Hardware
2.3.2 Cloud Computing
2.4 Architecture: How to Define a “Network” in an NFV World?
2.5 Lessons from the Virtualized World: Meraki Case Study
2.6 Market Drivers
2.6.1 CapEx/OpEx Reduction
2.6.2 Improved Time to Market
2.6.3 Improved Scalability of Services & Network Topology
2.6.4 Energy Reduction and Improved Operational Efficiency
2.7 Market Barriers
2.7.1 Performance Trade-Off
2.7.2 Security Concerns
2.7.3 Integration & Network Stability Challenges
2.7.4 Driven by Standards (ETSI/ISG) and “Too Many Cooks”?
2.8 Case Study: If a Telco was run with the same economies as AWS, Azure or Google server farms, what is the benefit/value etc?
2.9 Technology: what is the real problem to be solved?
2.10 What is the role of the CloudNFV Group?
3 Chapter 3: NFV Use Cases, Implementation Areas & Case Studies
3.1 Mobile Core & IMS
3.2 RAN & HetNets: Enabling Cloud RAN
3.3 Home Environment Virtualization
3.4 NFV based Infrastructure as a Service (IaaS)
3.5 What are the other trajectories for the network and NFV should/could be aware of (they all matter)?
3.6 NFV Implementation Case Studies
3.6.1 BT
3.6.2 AT&T
4 Chapter 4: NFV Vendor Landscape
4.1 Vendors are already lined up: who is doing what?
4.2 6WIND
4.3 Alcatel-Lucent
4.4 Amdocs
4.5 Cisco
4.6 Connectem
4.7 ConteXtream
4.8 Ericsson
4.9 F5
4.10 Huawei
4.11 Intel
4.12 Juniper
4.13 NEC
4.14 NSN
4.15 Openwave Mobility
4.16 Skyfire/Opera
4.17 Oracle
5 Chapter 5: Key Issues in an NFV World
5.1 What are key elements from a cost/performance perspective?
5.2 Dimensioning and elasticity
5.3 Transition from now to new (i.e. fork-lift vs. selective implementation)
5.4 Does NFV help in Content Delivery?
5.5 Does NFV help in Contextual Communications?
5.6 Will NFV generate new revenues, services, & applications?
5.7 Money flows
5.7.1 Does the pie shrink, or is there more opportunity: does NFV open the industry for non-traditional telcos?
5.7.2 Could an enterprise integrate its Cloud/IT services with NFV and benefit?
5.8 Lessons Learned So Far
5.9 Ecosystem: Who are the Winners and Losers?
6 Chapter 6: Forecasts
6.1 NFV Revenue: 2014 - 2019
6.2 NFV Revenue by Region 2014 - 2019
6.2.1 Asia Pacific
6.2.2 Eastern Europe
6.2.3 Latin & Central America
6.2.4 Middle East & Africa
6.2.5 North America
6.2.6 Western Europe
List of Figures
Figure 1: The ETSI Vision for NFV
Figure 2: Relationship between NFV and SDN
Figure 3: COTS Hardware in an NFV Setup
Figure 4: Energy Reduction in an NFV Setup
Figure 5: CloudNFV Open Framework
Figure 6: Mobile Core Virtualization
Figure 7: Mobile RAN Virtualization
Figure 8: CPE Virtualization
Figure 9: NFV IaaS Setup
Figure 10: NFV IaaS Revenue: 2014 – 2019 ($ Million)
Figure 11: NFV Solution Sales Revenue: 2014 – 2019 ($ Million)
Figure 12: NFV Solution Sales Revenue by Region: 2014 – 2019 ($ Million)
Figure 13: Asia Pacific NFV Solution Sales Revenue: 2014 – 2019 ($ Million)
Figure 14: Eastern Europe NFV Solution Sales Revenue: 2014 – 2019 ($ Million)
Figure 15: Latin & Central America NFV Solution Sales Revenue: 2014 – 2019 ($ Million)
Figure 16: Middle East & Africa NFV Solution Sales Revenue: 2014 – 2019 ($ Million)
Figure 17: North America NFV Solution Sales Revenue: 2013 – 2019 ($ Million)
Figure 18: Western Europe NFV Solution Sales Revenue: 2014 – 2019 ($ Million)

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