 Hi, I'm Peter Burris and welcome to another Cube conversation from our outstanding studios in Palo Alto, California. Got a great conversation today. We're going to be talking about some of the challenges and changes taking place in the MSP, the managed service provider part of the marketplace, made possible by software-defined WAN, SD WAN Technologies. And to do that, we've got Alistair Johnson, who's a principal architect at Nuage Networks here with us on theCUBE today. Alistair, welcome to theCUBE. Thank you Peter, it's great to be here. So let's start corporate update, Nuage Networks. What's going on? Well, we've had a pretty good year so far. A number of customers that we'll be announcing over the next few months that we've established this year, in addition to the major wins that I'm sure most of the market's familiar with over the last few years. We're really seeing that in the managed services space, that SD WAN is gaining a lot of traction. We're finding that particularly outside of North America, but with increasing North American interest, that enterprises are looking towards a managed SD WAN service as opposed to doing it themselves. Going down the path of having a carrier come in and provide them with both connectivity and the service layer, or looking at taking the service layer from a managed services provider and sourcing the connectivity themselves. So this is an area that's especially fruitful and open for some significant innovation, and innovation that's going to have enormous impact on how the market behaves. So let me run something by you. So here's the observation I've made over the years. That servers, Moore's Law meant that there was this kind of smooth growth and performance. And even in software, it kind of followed Moore's Law. But network, because of the degree of interplay and natural integration amongst the components, there was always this kind of weird step function where every four or five years, the big telecommunications companies or managed service providers, would make major investments in their networks. And you got this very rough, coarse, odd step function. And that sometimes scared some of these companies away from participating in all the innovation of the cloud. Have I got that right? Absolutely. I mean, the tradition of having both your service layer and your transport layer being coupled, you know, an IP network is offering both the IP transport, but also the services like MPLS VPNs or layer two VPNs. It was meant that, you know, the tech lifecycle became relatively long. The process to qualify, deploy, manage, and then eventually automate services and the delivery of those services took a long time. SDN has presented a really interesting opportunity for the carriers along with the broader audience in the industry to really leverage software and the frequency of updates that software can give you without needing to make those hardware changes at the same time. So you can still do the hardware changes but you get a smoother upward innovation curve. Absolutely. So the underlying transport platforms, the routers, the DWDM systems, et cetera, those can be changed as needed to by capacity demands or vendor changes or new technology that comes out in those spaces. But we can use SDN or in this case SD-WAN to smooth out the service offering on the top. And as it becomes a software delivered function, we can upgrade that much faster. We can roll it out much more like we update our cell phones, our tablets, et cetera, and introduce new functionality into the service layer much faster than we were able to do in the past where we had a very much a hardware-coupled service offering. Now I made a comment that in many respects, some of the big telecommunications companies, some of the big MSPs have not participated in this explosive innovation that's associated with cloud. And part of the reason is because when you think about cloud, someone can say, I can think of a new service and then they can create it and deploy it because it's largely in software. Whereas a lot of the telecommunications MSP type companies go, I can think of a new service, but then they look around and they say, oh, the hardware's not ready and I've got to wait for the hardware to be ready. How does this notion of SD-WAN and this software-defined service layers start to alter the way that some of these big companies think about their underlying infrastructure and all structures, how they think about automation, how they think about competing for new services? Well, it becomes a very big competitive differentiator because I can be a carrier and I can offer new services much faster, as we touched on. I'm getting a benefit of automation very quickly because SD-N was heavily around automating the configuration in the service elements and I can become a lot more cost-effective with that. Customers are looking for more self-control, more self-management, information, diagnostics, tooling, et cetera, but without the overheads of running very large IT and network-specialized personnel. So the carriers get that advantage, the enterprises get that advantage, everyone is getting effectively a much more modern service experience. We saw that with the cloud, I guess, revolution, if you want to put it that way, that I no longer needed to order a server, put it in a rack, deploy an operating system, put my application on it, take six months. That changed with the cloud, everyone understands that. The network layer did not change as fast and that's where we saw SD-N and the data centers come along to address that problem, that's what we're solving with SD-WAN as well. So when we think about the relationship between big cloud players and some of these MSPs, it is that we've got the big cloud payers that are virtualizing everything, the MSPs who are still kind of physically stuck, but still have the vast majority of those last miles that are so crucial to having that end-to-end productivity and compatibility. Does that start to change as we start to think about new wireless technologies? How does SD-WAN improve the MSP's ability to both bring new automation and bring new, but also introduce some of these new technologies that will make it easier to think cloud last mile in the same breath? Well, it's an interesting point. I mean, you could look at an MSP that has no last mile infrastructure at all. They were maybe reselling a carrier's infrastructure or procuring it for their enterprise customers. Now they have the ability to actually manage the service layer and they could be using Carrier A today to reach the customer's location, but they strike a new deal tomorrow with Carrier B and they can swap that customer over, effectively changing the engines on the airplane in flight. The customer experience doesn't change for the enterprise. They're still getting the same SD-WAN service, but maybe they've swapped from DSL to cable as a transport or they've added an MPLS service to a new site as well for greater reliability. So this allows the MSP's and the carriers to get services out to the customers faster, decoupling it from whatever the last mile technology may be. And this is where there's opportunities for wireless. We're seeing a lot of interest from enterprises to augment with LTE in the future, 5G, as a backup connectivity to their sites, particularly in retail. I mean, I'm sure in Silicon Valley, you've seen everyone here is swiping your card on a tablet. Well, you don't want that tablet to be offline. It needs connectivity or they're not making money. So making sure you have reliable connectivity with the same experience is a big deal for these enterprises and their MSPs. But it's now becomes part of a coherent solution as opposed to I'm going to do my cloud thing and I'm going to do my MSP thing. Absolutely. And so that's another area where we're seeing a lot of interest. I mean, even if I look at what our internal IT is doing, which is, you know, we need to make sure that the cloud is part of our WAN. And we need to make sure that we can, you know, drop an application in our private data center but have resources in our public infrastructure also using that. And the experience for me, sitting at my desk down the street from here is the same regardless of where that application is being accessed from. All right, the last thing I want to talk to you about Alastair is this notion I have. I'm going to test something by and see if I got it right and if I can, if I'm anticipating some of the changes that we're going to see. So a lot of people presume that the cloud was a one-way ticket to something centralized and big. And that had an enormous impact on how people think about the cloud. We actually think about the cloud as a strategy and a technology for more easily and coherently distributing data and distributing function to where it needs to be on a location basis. Absolutely. And in certain respects, I can look at the cloud kind of as a network programming model where some of those hybrid cloud services that are being introduced by some of the big cloud players now are really almost a layer seven. They're providing some structure to the developer about how to think about building hybrid distributed applications. Now, I want to test that. Does that resonate with you from a networking standpoint? Absolutely. And again, that's something we see a lot of interest in. A reasonable amount of demand as enterprises and their internal developers are getting their heads around that concept that the application can live anywhere, whether it be on-premises, at the branch, data center, or in the cloud. And that cloud, as you point out, can be rightly geographically distributed. And being able to be the network glue that binds all of those locations together allows the developer and the IT organization supporting that developer to have the effect of a single fabric, regardless of where the application or the user is, seamlessly connecting them. And so it also suggests, and this is nothing I want to test with you, it makes it possible to imagine greater specialization in what those distributed services look like, especially from a networking perspective, which means that if MSPs and big telecos do successfully incorporate some of these technologies, improve their automated ability, their ability to think about the service and then deliver the service very rapidly, then we could see them actually being able to pick up a sizable piece of this cloud business because they can introduce services that are specialized with a network, strong network affinity that build on that heritage of distribution of function. Absolutely, and you see that today. The carriers are already providing a valuable service connecting the enterprises to the cloud, but that goes beyond in an SD-WAN 2.0 model. I need to move certain applications to the branch. There's some things that always need to live there. And as an IT manager, I need to manage that networking effectively. But I have applications that I want to have that are running in a very public cloud, SaaS applications, et cetera. And I want to give my users the most efficient path to them. But I also have my private applications that it may be running in a public environment, but I want to carry that as if it was part of my internal corporate WAN. And being able to get that from an enterprise, services perspective, from an MSP, from a carrier that can bundle all of this together, that's a huge advantage and a time saving for me. Yeah, the one other thing I'd say is that we're actually talking to some very large enterprises right now that are discovering that their customers, their customers are demanding very concrete, strict and well-documented notions of the capabilities that they provide. And this idea of SD-WAN is making it easier for them to sell services into companies that want that digital interface, that highly competent working digital interface. Absolutely. So last thing is we think about where this is going. Is there any technology on the horizon that you think SD-WAN is going to make easier to deploy or that's going to make SD-WAN that much more important? Oh, that's an interesting question. And I think as the ongoing digital transformation of business happens, where connectivity is more important than ever, making sure it's reliable and available and that the user experience, regardless of what type of site I'm visiting as an enterprise employee, making sure that my telephony works, that my can access my documents, that my R&D teams can span the globe, that is a key requirement of today's enterprise. At Nokia, that's how we need to work internally and that's how we do work. I travel around the world, visit our offices, my experience is seamless and the same. And that I think is where SD-WAN's bringing a huge amount of automation value security in many cases and tell you some great anecdotes that we found in the SD-WAN world there. And just the management and control layer. Well, let's save another cube conversation and talk about the security anecdotes. Well, but this is Peter Burris. We've been talking to Alistair Johnson who's a principal architect at New Irish Networks about the potential for SD-WAN to increase the relevance of MSPs, telecom providers in a marketplace that is being dominated by the cloud experience and how greater automation leads to improved service opportunities for a lot of customers and a lot of cloud related service providers. Alistair, thanks very much for being on the cube. Thanks Peter. And once again, I'm Peter Burris and you've been watching another cube conversation. Until next time.