CAPEX Reduction Not Likely with NFV

Comments: 0 Runtime: 1:13 Posted: April 2nd, 2015

Network Function Virtualization (NFV) has not produced the expected CAPEX savings.. Anyone looking at NFV from a CAPEX perspective is likely to be disappointed.

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When people first started talking about NFV, they would wave their hands and say, "Oh look at all the CAPEX savings we're going to get." That expensive, dedicated appliance is now going to be running on off-the-shelf products. Look at all that savings. Most people I talk to would say, "No, that's probably not going to happen." What people have been telling me is, "Jim, over the last couple of years," this is from vendors, "we've been doing a lot of our functionality on off-the-shelf-products." If it can be supported that way, it doesn't need dedicated hardware for some kind of encryption, or some kind of functionality like that.

Bottom line, we've already enjoyed, if you will, a lot of the benefits from that. May there be some additional CAPEX savings? There could well be, but I think anybody that's looking at NFV, largely from a CAPEX perspective, is likely to be disappointed.

Written by Jim Metzler
Founder Ashton, Metzler & Associates

Jim Metzler is an expert at researching and analyzing emerging technology trends within the networking and service provider space.