(Author’s Note: I’m a farmer’s daughter from Iowa who is thrilled to put a focus on innovation for RURAL broadband. Writing this post brings up memories of our party line (that cousin who listened in) and immense relief when we finally got a private telephone line. I fast-forward through the innovations of personal computing, the Internet and mobile, noting how quickly my Iowa relatives adopted. A Realtor in Grinnell, my mother is a bleeding-edge adopter. She went mobile (it was huge, very heavy and lived in her car) several years before her city-residing adult children got cell phones. Rural business owners must innovate to succeed. The same is true of rural broadband providers, who can now virtualize to remain profitable and compete for new business.)
Rural broadband providers are facing the uncertain future of federal funding. For many years rural broadband providers have been compensated for the high cost of delivering service to low-density or rough terrain areas. Changes in Universal Service Funding are making it much more difficult for rural providers to obtain funding or recoup the high cost of providing services in remote locations.
Rural broadband providers need new technologies and strategies that help them build revenue, reduce costs and become more operationally efficient. They need strategies for competing or partnering with larger providers and/or public-owned providers.
Virtualization of network functions provides many advantages for communication and data services providers, and can be particularly beneficial for rural broadband providers today.
Tory Richtmyer says Network Functions Virtualization (NFV) can help rural broadband providers with new business now and innovation for the future. Richtmyer is with Mid-States Consultants, a firm that provides a full suite of engineering, infrastructure mapping and management software as well as supporting services. Richtmyer notes that by deploying NFV, service providers gain flexibility and efficiency while significantly reducing operational costs. Along with those benefits come new opportunities that can enhance profit margins.
NFV: Software Running on Low-Cost Hardware
NFV is a new approach that enables on-demand service flexibility and scalability.
With NFV today’s expensive hardware appliances are replaced with software virtualized network functions (VNFs) running on commercial off-the-shelf (COTS) servers. Service providers deploying NFV can activate a service by loading new software VNFs, remotely, on COTS servers rather than always rolling a truck to deliver and set-up an expensive hardware appliance for a new order.
With this “softwarization” of the network comes agility, flexibility, lowered operational costs and choice: choice of software, choice of hardware, choice of topography and choice to change at a moment’s notice.
For rural broadband this means greater profitability through increased revenue and lowered costs.
Pure-play NFV is open software running on open COTS servers – no proprietary hardware is necessary. Until now, carrier-class network environments have relied upon a single vendor’s proprietary software/hardware solutions to deliver services and manage the operation, which is expensive and limiting. With NFV they are no longer going to be locked-in with one vendor for hardware and software. Instead operators will be able to choose best-of-breed solutions at every step.
Some virtualization solutions simply add an open compute node to a proprietary appliance, creating a hybrid NFV solution. However, choosing a pure-play NFV solution now opens the environment to the broadest choice and flexibility in software, hardware and topography and stops hardware vendor lock-in now and for the future.
Richtmyer counsels Mid-State’s rural broadband clients to implement NFV now for easily defined new revenue opportunities but also to set the stage for unlimited innovation in the future.
“We will see an explosion of service offerings once we create the ability to innovate with virtualization,” he says.
“Our rural broadband clients are a passionate, motivated group and they will innovate. It’s hard to even guess what is possible. I can’t wait to see what they can do once they deploy NFV.” – Tory Richtmyer
With NFV, rural broadband providers can branch out into new offerings like security and managed services. They can also compete on price against larger competitors and win new customers. And, this is just the start.
NFV provides the platform for evolving service offerings for years to come. Following are suggestions for how rural broadband operators can increase revenues with NFV today and lay the groundwork for nearly unlimited innovation.
New Customers and Business
With NFV, rural broadband operators gain operating efficiencies that lead to significant reduction in costs, opening the door to compete for all customers.
For instance, a rural broadband provider could compete with a Tier 1 provider in a neighboring urban area with better pricing on data and phone services. Or, it could compete head-to-head with cable or satellite to deliver data and media services.
New partnership opportunities are also possible. NFV provides the flexibility to partner and provide value-added services such as cellular backhaul, offsite backups, emergency response, tailored billing, customer self-monitoring, self-service and self-provisioning, and PBX-like voice and data offerings.
Extending the Functionality of Fiber Networks
With the advent of NFV and openness, providers can now quickly and cost-effectively activate new services, automate system management and move a network environment with a few keystrokes. The number of truck rolls can be reduced. This saves a tremendous amount of time and money, and better serves the end customer.
With pure-play NFV, virtualized functions can be run anywhere in the environment on low-cost servers. Rural broadband service providers can utilize NFV orchestration to automate service delivery, troubleshooting, response to customer requests, reporting and billing and more.
When talking with his clients about virtualization, Richtmyer points to new levels of service agility as a major NFV benefit. The NFV system can respond quickly to an end customer request, resulting in new revenue opportunities that start immediately rather than weeks or months later.
“Rural operators can branch out immediately with security, database and managed services. They can offload IT and storage for large or high-value customers. Or, they can address security concerns with location, network and database security services with offsite hosting, backup and/or environmental services that provide significant value to their existing customer base,” Richtmyer notes.
Sharing for Efficiency
Rural broadband providers are already joining together for economies of scale and operational efficiencies.“Some partnerships involve an informal alliance where one provider takes over management of a neighboring service area,” says Richtmyer. “In other cases, they are dividing and conquering in that the company with the best technical capabilities handles support, and the company with the best management solution handles billing or operational support systems, such as mapping/plant records or network monitoring.”
More importantly, he says the flexibility of activating and changing services and functionality points to better customer service on a macro level. The sharing moves from provider to customer.
For instance, a school system might want top-shelf broadband service during the school year but minimal or no service over the summer. The resources the school utilizes during session can be re-commissioned over the summer to the county fairgrounds or a local music festival at little or no cost. This makes the service far more attractive to seasonal users, has the potential to increase revenue and results in greater network utilization.
Likewise in ski country resorts are heavy broadband users during snow season but require only basic services in warmer months. The carrier can ratchet up and down functionality and capacity to fit demand quickly and cost-effectively.
NFV also makes it possible for public entities to piggyback with private companies, giving better service to a public library, for instance, that it could otherwise not afford.
Another way NFV can be highly beneficial for rural broadband is with cost-effective ways to support local, state and national first responders programs. Local, state and national first responder networks are short on funds for building the vast dedicated networks needed to ensure availability. They also only need those resources when an emergency occurs.
With virtualization we can create a private/public partnership under which a fully utilized environment can be split as needed to provide dedicated service to police, fire and medical response efforts for the short period required to respond to an emergency.
FirstNet is the organization mandated by the federal government to build, operate and maintain the first high-speed, nationwide wireless broadband network dedicated to public safety. FirstNet must provide a single interoperable platform for emergency and daily public safety communications.
Some service providers have worried that the FirstNet First Responder network will impose requirements that outweigh the benefit of sharing the costs. NFV should help alleviate this concern; NFV can help dynamically allocate bandwidth, and even reconfigure some parts, to provide First Responder priority access without cutting off existing subscribers. Also, when the First Responders are using heavy bandwidth, they will be paying the market rate and generating solid revenue for the provider.
“It would be like hitting The Bat Signal and dedicating resources to Batman when he needs them. Otherwise, for 99 percent of the time Company G has access to 100 percent of the resources,” says Richtmyer. “It’s an ideal situation for the first responders and Company G benefits by sharing the overhead costs of its network with Batman.”
A Starting Point for Innovation
The beauty of virtualization is flexibility and responsiveness – at much lower cost. Rural broadband providers are creative and motivated business people. There is no doubt that once NFV is deployed they will discover additional ways to innovate for greater customer service and overall profitability.
“We are going to be challenging our clients to figure out new and better ways of providing services. We fully expect that these Tier 3 providers will create many new ways to compete on service level and price without a lot of investment,” Richtmyer notes.
We at ADVA Optical Networking are looking forward to helping rural broadband providers go virtual with pure-play NFV solutions that provide the greatest choice in hardware, software and topology. Let the innovating begin!