During the first half of 2022, SPs continued to push a dual vendor strategy and shift towards fixed architectures to eliminate complexity. Fixed 1RU and White Box architectures in Routing (based on Jericho chipset) became enticing to many customers. There are nearly a dozen white box vendors shipping today across multiple regions that can run as a standalone router or part of a cluster of white boxes acting as a single routing entity and replacing the chassis model. While there are still some dependencies (Jericho ASIC), the diversification is significant and less risky and is helping drive disaggregated routing growth. For 1H22, Disaggregated Routing grew over 50% Y/Y, well above the overall Routing growth rate, which grew less than 5% over the same period.
We were excited to see last week’s news that DriveNets raised their Series C Funding. We view this as an exciting step in the Router market as it moves towards disaggregation and cloud-based architectures to support today’s and tomorrow’s Telco architectures. DriveNets also supports the largest number of white boxes in a single cluster, which makes its solution the highest-capacity router available.
Strong Tier-1 SP Adoption
Our SP interviews indicate that DriveNets, with Broadcom’s Jericho-based ASICs, are deployed in production at four of the largest ten western SPs (excluding China). Furthermore, we believe they are in deployment or trials with many of the top 30 SPs in the world. Tier-1 SPs continue to diversify supplies (both cost and COVID supply constraints related), and the move towards Fixed platforms instead of large modular chassis allows them to bring more vendors into the Router ecosystem and streamline hardware deployment.
ZR/ZR+ DCI Opportunity
The original use case for Disaggregated Routing was around traditional router edge/core networks. SPs have a significant interest in deploying ZR and ZR+ in their networks since they allow for the collapse of the edge optical layer into the routing platform. Hyperscalers are pushing this collapse with significant investment in their DCI layer. As a result, SPs will see considerable capital and operational savings when they deploy ZR.
More Fixed Platforms
Disaggregated Routing leverages the hyperscalers’ supply chain of smaller and easier to build Fixed platforms. But unlike the data center architecture where each fixed platform is a separate entity, in Routing, several fixed platforms (white boxes) can be clustered together to create a single router entity, which is easier to manage. Different size clusters provide an alternative to different sizes of routing chassis. Therefore, they were named a Distributed Disaggregated Chassis (DDC) by the Open Compute Project (OCP). This approach can address today’s availability challenges and provide a cleaner and better model. Hyperscalers figured this out and are currently benefiting from disaggregated architectures during this supply shortage. Without even more fundamental building blocks, SPs will not keep pace with hyperscalers or absorb supply chain shocks as robustly.
Rest of 2022 and Beyond
We expect significant growth in disaggregated Routing during the next four quarters and customers move from trials to production as existing deployments continue to expand. At the same time, we expect additional Jericho-based silicon to enter the market and increase speed and performance.
By Alan Weckel, Founder and Technology Analyst at 650 Group.