Major carriers, such as BT, AT&T, Deutsche Telekom and others are holding back from investing in software-defined networking (SDN) and network functions virtualisation (NFV).
Furthermore, carriers' hesitation has had an impact on equipment manufacturers, who report that carriers have become cautious over investing in any infrastructure in advance of the expected coming shift to SDN.
That is according to research by specialist communications analyst group Infonetics. "Last quarter, we identified the 'SDN hesitation', where we believe the enormity of the coming SDN and NFV transformation is making carriers be more cautious with their spending," said Infonetics co-founder and principal analyst Michael Howard.
"This hesitation reared its head in the first quarter of 2014, where global service provider router and switch revenue increased only two per cent from the year-ago quarter."
On the one hand, telecoms giants have existing voice and data networks that need to be maintained and expanded as demand continues to grow. However, with a shift expected to occur over the next decade, many are reluctant to spend money on equipment that may quickly become obsolete.
"We believe the current generation of high-capacity edge and core routers can be nursed along for a while as the detailed steps of the SDN-NFV transformation are defined by each service provider-and many of the largest operators in the world are involved, including AT&T, BT, Deutsche Telekom, Telefónica, NTT, China Telecom, and China Mobile," said Howard.
"And there is intensifying focus on multiple content delivery networks (CDNs) and smart traffic management across various routes and alternative routes to make routers and optical gear cooperate more closely."
SDN represents a continuation of the trend towards virtualisation applied to networks, with the network intelligence decoupled from the underlying hardware and embodied in configurable software. The idea is not new, but was first articulated by AT&T researcher David Isenberg in May 1997 with his research paper, "The Rise of the Stupid Network".
At the time, AT&T disapproved of the idea and demanded that Isenberg remove the paper from his website. He left the company shortly after.