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Telecoms Vendors & OEMs

Telecoms Vendors & OEMs

Is the Ciena/Ericsson deal evidence of climate change?

Ian Scales
By Ian Scales

Feb 17, 2014

We’re obviously not talking about the wet and windy sort of climate change that many of us are currently enjoying (you see what we did there?), but the business climate change that SDN and NFV proponents have been talking about for the past 18 months or so. That’s where everyone on the supplier side of the house gets together, listens intently to the customers (telcos mostly, in this case) and with a high five here and a back-slap there starts making pacts around interoperability, compatibility and all the other ilities you can think of.

In the new world of telecoms technology change (without nailed-down standards to aim at) this is the only way forward. And apparently to that end, Ericsson and Ciena have announced that they will work together on “transport solutions” for converged IP-Optical networks. Once all that’s in a straight line they will be able to apply Software Defined Networking (SDN) to the offer.

There is no talk yet of rationalising either product line (there is overlap with Ericsson’s products) but Ericsson will add Ciena’s packet-optical families to its solution-set and sell those as well.

Is this a prelude to a full merger? That’s possible and to rule it out as absurd would be tempting fate (mergers and acquisitions being the least rational area in this business) but in the new world I’ve outlined such a move has less industrial logic behind it than it might have five years ago.

If everything we keep being told (on and off the record) is true then the telco customers are awarding high marks against vendors’ abilities at folding in multiple partners and being more interoperable than the next guy. Ericsson, for instance, has been joining and engaging all over the place with SDN standards including the Open Networking Foundation (ONF) and OpenDaylight Project. It has just opened a lab in San Jose to enable other companies to test their applications on OpenDaylight’s Hydrogen SDN software release.

That outward-looking sort of activity doesn’t rule out the old-fashioned technology buyout, but it does make it less likely (and less necessary).

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