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What’s Next in SD-WAN – Evolving the vCPE Platform

Jul 01, 2019


This is the final post in a three-part SD-WAN series by AvidThink on the evolution of SD-WAN, vCPE, uCPE and the emerging importance of the vCPE operating system. The first article examined the origins of the vCPE and SD-WAN, while the second discussed the importance of the vCPE operating system. This third and final article will provide AvidThink’s insights into the future evolution of the vCPE platform.

Is the vCPE Platform Commodity or Strategic?

Within the SD-WAN ecosystem, there’s an open question as to whether the ownership of a vCPE platform, including the vCPE OS, is strategically important or not. After all, the key network functions are performed by the VNFs, and we could view the vCPE OS as simply a platform on which these VNFs are hosted. That may be true, but market power (or potential market power) stems from many factors, including but not limited to:

  • The number of vCPE OS platform suppliers and the presence of open source options.
  • The sophistication required to create the vCPE platform and the software complexity.
  • The role of the zero-touch provisioning (ZTP) management system and stickiness of the cloud controls.
  • The number of suppliers in the related value chain including uCPE and VNF providers, and how much differentiation there is in each of those areas.

As it stands, the vCPE OS platform market has a limited number of providers, and there are few open-source options available. As we have discussed in earlier posts, the open source DANOS from the Linux Foundation isn’t currently available, and it’s unclear how comprehensive and sophisticated DANOS will be when it is released to the public. It is also not clear what type of momentum or adoption it will achieve once launched. Of particular concern is the nature of its ZTP and whether cloud-based management will be part of the offering. Similarly, it’s also not clear whether it will just provide a base OS, or will it include a virtualization layer for management of VM-based and/or container-based VNFs.

Regardless of how the ecosystem in vCPE evolves in the near future, AvidThink expects the vCPE platform to play a strategic role in the SD-WAN market. A good part of the reasoning behind this is that many of the ease-of-use, scalability, deployability, and manageability functions that enterprises are looking for from SD-WAN are currently provided by the vCPE platform.

Integrating Upwards

While the vCPE platform already provides value in an SD-WAN offering, it’s likely that vCPE OS platform suppliers will continue to push for increased differentiation. Part of this will be improved ZTP features, as well as partnerships and integration efforts with uCPE platform providers to streamline hardware onboarding, potentially accelerate overall system performance, and reduce the friction required to ship a new hardware platform. But AvidThink believes a good number of vCPE platform players have desires to forward integrate into the VNF market — a market much larger than the vCPE market.

As vCPE vendors continue to seek differentiation against each other and as they gear up to protect themselves against the potential erosion of value by DANOS (when launched), it’s very tempting to forward integrate and provide some common and basic VNFs as part of the overall vCPE OS platform.

Integrated VNFs and Third-Party VNFs — Is One Better?

Some vCPE platforms already provide integrated VNF-type functionality like routing and simple stateful firewalls. Linux itself already comes with a number of built-in capabilities, making it easy to package those as built-in VNFs. Likewise, there are a set of open-source projects with common functionality like Suricata (intrusion prevention systems), Free Range Routing (FRR) for more sophisticated routing, and many more that could be integrated into the vCPE platform to provide a richer set of built-in functions.

As the market evolves, AvidThink expects that vCPE platform providers will likely add more functionality into their platform to entice CSPs and enterprises. The benefit of having built-in VNFs will likely stem from cost and possibly performance. vCPE vendors will probably not charge much, if anything at all, for these built-in VNFs. These cost savings should reduce the total cost of ownership for CSPs, SIs, or enterprises deploying an SD-WAN solution with the vCPE platform. Additionally, with a more integrated approach and less overhead in hosting a separate VNF, it may be possible for the vCPE vendor to accelerate the performance of these built-in VNFs when compared to a similar 3rd-party VNF.

On the flip side, dedicated VNFs will usually have a richer feature-set than built-in VNFs – any dedicated VNF that doesn’t won’t last long in the market. It will come down to the needs of each end-user customer in terms of their requirements and how well the integrated functionality meets those requirements. It’s possible that customers could start with built-in basic functionality and then upgrade to full VNFs as their needs increase.

Wrapping Up — Containers and More

Finally, there’s another aspect to the vCPE OS platform to cover: support for Linux Containers. While VMs are the dominant option today for packaging and deploying VNFs, we expect the drive towards to Cloud Native and Linux Containers to force evolution on the vCPE OS platform. Beyond built-in VNF-type functionality, AvidThink expects to see continued evolution of container support, including fitting Kubernetes as an orchestrator into the feature set.

One parting thought around SD-WAN and vCPE. The vCPE platform today is popular for SD-WAN and SD-WAN-type deployments. As the platform evolves and becomes richer in its feature set, we expect it to be a potential contender within the IoT and 5G ecosystem as well, moving from a specific use case around SD-WAN into a generic edge platform across all markets.

We hope you’ve enjoyed our three-part blog series on AvidThink’s observations around the SD-WAN market and the vCPE platform in particular. We want to express our appreciation to RAD for sponsoring and hosting this article series. If you have feedback for us, please write us at [email protected].


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About AvidThink

AvidThink is an independent research and analysis firm focused on providing cutting-edge insights into the latest in infrastructure technologies. Coverage areas include 5G, AI/ML, cloud, edge and IoT, NFV, SD-WAN, SDN, hyper-converged infrastructure, and infrastructure security.




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