HP Takes Aim At Cisco With Network Virtualization Offering

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Hewlett-Packard has Cisco firmly in its sights with the launch  of a new network virtualization offering that is aimed at moving telcos service providers to industry-standard hardware at a savings of 35 percent to 50 percent.

HP Monday formally launched at Mobile World Congress in Barcelona HP OpenNFV, its open-standards-based telcos service provider reference architecture, which is backed up with the launch of a number of HP OpenNFV labs and an extensive partnering effort to support NFV applications and services.

"I think this provides us an opportunity in the next two to three years to take significant share from Cisco," said Jeff Edlund, the chief technologist of Futures, Communications and Media Solutions Hewlett-Packard, who got the green light from HP's Executive Committee to go up against what he called Cisco and other proprietary network suppliers.

[Related: Mobile World Congress: What To Expect]

HP is already pressing Cisco hard in the networking business. HP's networking business grew 4 percent year-over-year in the most recent quarter. HP's network switching business grew 5 percent compared to a 12 percent sales drop for Cisco in that networking segment.

Cisco's service provider business, in fact, was a big trouble spot for the company, with orders falling 12 percent for its second fiscal quarter ended Jan. 25. 

HP says the NFV cost savings it is promising is resonating with customers. Alcatel Lucent, which is partnering with HP on OpenNFV, said the partnership enables Alcatel Lucent to "free up R&D investment dollars to focus more on innovative software technology" rather than hardware.

The 35 percent to 50 percent capital expenditure cost savings, depending on the licensing, have been demonstrated in HP proof of concepts over the last two years, said Edlund. "This is the total savings after all the business transformation costs have been netted out," he said.

The cost savings for VMware are more in the 35 percent range given VMware software licensing costs, said Edlund, while the KVM (Kernel based Virtual Machine) hypervisor is at the high end of the scale.

Page Murray, vice president of worldwide marketing for HP, said the NFV is another example of HP's ability to deliver the "right product at the right price at the right time. We are effectively bringing down the price per virtualized machine by 50 percent and the time-to-product by 47 percent. You are cutting the cost in half and getting it almost twice as fast. These are [HP] Moonshot- [server] like changes."

NEXT: HP Aims To Capitalize On A Landmark Telecom Shift


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