Networking, and its transformation, is more than just technology. Broadband Internet came along during an unfortunate shift in the politics of networking. In the '80s and '90s we were moving from a global vision of communications as a regulated monopoly or even a government agency to one of a free market. The Internet exploded on the scene during the shift, at a time when subtle distinctions between "communication" and "information" services made an enormous difference.
The operators were left on the communications side, and what we call "over the top," or OTT, players took what turned out to be the new age of services, the information services. What operators want now is a combination of a lower base cost for their commodity communications services, and a way to participate in that dazzling information-services future. The current software-defined networking (SDN) and network functions virtualization (NFV) revolutions are credible to the extent they can address this dualistic goal.
The challenge for revolutionary change is revolutionary benefits. Both SDN and NFV are really about service automation. Neither SDN nor NFV proponents had paid much attention to operations in their early work, and little has changed since. As a result, the whole basis for a revolutionary solution to cost control and revenue augmentation has been compromised. There's some recognition of this problem now, but because the operators say that their revenue- and cost-per-bit curves will cross over in 2017, they may not have time to solve the problem.
Well, not by a revolution. As it happens, we have a second possible approach.
Virtualizing the Physical Layer
For the last five years, without much fanfare, there's been an evolution in the role of Layer 1 (L1) -- the physical layer where optics and dumb tunnels or pipes live -- technology in the old OSI model. Agile physical media seems to be a contradiction in terms, but what we're really doing is virtualizing the physical layer. Since, in the OSI model, the physical layer's limitations in scope and cost efficiency is what created the need for higher-layer aggregation and connectivity, making Layer 1 more capable lets you simplify the higher layers.
With virtual-L1 technology, you can separate customer networks and services below the Ethernet (L2) or IP (L3) layers. That would seem to drive us toward a bunch of expensive and inefficient service and customer silos -- except for another factor, which is "virtual routing."
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