Download CENX: expanding the orchestra with Exanova Service Intelligence

R E P O RT R E P R I N T
CENX: expanding the orchestra
with Exanova Service Intelligence
platform
J E N N IFER C L AR K
0 5 M AY 2 0 1 5
The company recognized the need in the market for operational software that removes the complexity of provisioning
new services and gives carriers visibility into the service, along with performance assurances. CENX has realized this
vision in its brainy Exanova Service Intelligence platform.
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CENX has its roots in the carrier Ethernet exchange market, and witnessed firsthand the baffling complexity, not to mention provisioning time, that carriers must deal with to establish services that span
networks, technologies and vendor hardware. While the carrier Ethernet exchanges were, and are, an
effective means of negotiating the interconnection of Ethernet services, CENX recognized the need in
the market for operational software that removes the complexity of provisioning new services and gives
carriers visibility into the service, along with performance assurances. CENX has realized this vision in its
brainy Exanova Service Intelligence platform, which, by knowing everything about the service and the
network, can effectively make the network disappear, giving carriers the ability to deploy services across
not only multiple datacenters and multi-vendor architectures, but across multiple networks.
T H E 4 5 1 TA K E
CENX has bitten off an exhausting workload in trying to dissolve the barriers to service deployment
across datacenters, vendors and networks. However, since moving into this service orchestration space,
the company appears to be thriving, with strong financial backing, an excellent executive team, a bevy of
marquee customers and a balance sheet that shows a profit. In fact, it is doing so well that it may be only
a matter of time before market envy attracts vendors such as HP and Oracle.
CONTEXT
CENX is a privately held company founded in 2009. While the company literature obliquely refers to headquarters in
the US, the press releases come out of Ottawa, and the management team comes from Nortel/Newbridge heritage in
their early careers. Investors in the company include Cross Creek Advisors, DCM Ventures, Highland Capital Partners,
Ericsson, Mesirow Financial and Verizon Ventures. The company recently closed another round of funding, but it did
not have to take its show on the road in search of new investors because all of its existing investors chipped in for the
new round.
CENX started out as operator of the world’s first and most-connected carrier Ethernet exchange, providing access to
more than 15 million Ethernet service locations. In 2012 it secured additional funding and expanded its product strategy beyond the Ethernet exchanges themselves to include a focus on software. While Ethernet exchanges remain
part of the CENX ecosystem, the company’s future lies in service orchestration, as we discuss in the strategy section
of this report.
CENX has an exceptionally strong management team, led by president and CEO Ed Ogonek, who assumed the role
in January 2013. Ogonek was formerly the president and CEO of network policy vendor Bridgewater Systems, which
was acquired in 2011 by Amdocs. Industry luminary Nan Chen is cofounder and executive vice chairman. Chen is
also the founder, and remains president, of the highly influential Metro Ethernet Forum. Chris Purdy, former CTO of
OSS/BSS vendor Nakina Systems, is CTO. The company just recently managed to snag Andrew McDonald, who joined
the executive team as senior vice president of product management on April 27, from Alcatel-Lucent, where he was
president of IP platforms.
While CENX is privately held, as mentioned, it has disclosed that it grew revenue by 500% in calendar year 2014 (yes,
the base number could be minuscule, but that’s good growth by anybody’s reckoning). Even more notable, the company claims strong profitability, and is generating cash. Additional 2014 milestones include:
ƒƒ Completion of multimillion-dollar deployments with two of the top four US mobile operators.
ƒƒ Customer wins in Europe and Asia.
ƒƒ Enhancement of the CENX cloud datacenter offering to provide enterprise on-demand interconnectivity.
ƒƒ Development of a strong partner program resulting in multimillion-dollar deals with a global managed services
strategic partner.
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S T R AT E G Y
Orchestration will likely be the dominant topic in software-defined networking (SDN) and network function virtualization (NFV) for the next two years, at least. Today’s SDN offerings tend to focus on a single datacenter and the
products of a single vendor. Operators are not happy with either of these limitations. They are actively looking for
options that are truly multi-vendor. Ideally, these would span not only datacenters, but networks, allowing carriers to
define services that are completely independent of the underlying physical network. This is the challenge that CENX
has set out to solve: service orchestration.
CENX starts by creating a unified service information model – a database of the network information harvested
continuously from a variety of disparate sources, including routers, other network devices, element management
systems, IT systems, and data sources such as inventory systems, spreadsheets, order activation notices and SLA
contracts.
With this information, and through the ongoing monitoring, audit and correlation of all defined data sources, the
CENX Exanova Service Intelligence is able to build an accurate, comprehensive end-to-end service intelligence foundation. Exanova uses standard REST APIs to share service-level information with the centralized control elements, and
thereby manages the complete end-to-end service lifecycle. Exanova provides integrated modules that enable the
creation of network service management functions and capabilities, which CENX defines as:
ƒƒ Service visualization
ƒƒ Continuous data audit
ƒƒ Automated reconciliation
ƒƒ Automated ordering
ƒƒ Automated provisioning
ƒƒ Workflow orchestration
ƒƒ Real-time troubleshooting
ƒƒ Network analytics
ƒƒ SLA management
ƒƒ Capacity planning
CENX’s goal with Exanova is not only to provide service orchestration to the carriers, but to do so using industry standards that facilitate operator migration to SDN and NFV, and support the increased virtualization of the network. At
present, CENX targets six key orchestration use cases with Exanova: mobile backhaul, enterprise connectivity services,
cloud exchange services, services workflow, machine-to-machine connectivity and just-in-time capacity management.
COMPETITION
The orchestration market is awash in competition from a variety of different vendor segments, each focused on a
different set of orchestration functions:
ƒƒ The telco systems vendors that are focused on NFV orchestration, which may or may not include virtual infrastructure management in their offerings: Alcatel-Lucent, Ericsson, Nokia, Huawei and Overture.
ƒƒ Startups that are likely to focus on a subset of the management and orchestration (MANO) task: Cyan, UBIqube and
Tail-f (now Cisco).
ƒƒ The IT vendors that are focused on NFV orchestration and include virtual infrastructure management: Amdocs, HP
and Oracle.
ƒƒ The network application vendors that provide VNF managers and the NFV orchestration: F5 and Citrix.
CENX is the first vendor in this crowded field to focus exclusively on service orchestration. Service management goes
beyond NFV orchestration to enable the management configuration and provisioning of network services that span
datacenters, vendors and networks.
We expect IT vendors Amdocs, HP and Oracle to emerge as competitors to CENX in this market. However, these vendors will be cannibalizing their existing OSS offerings with their NFV orchestration offerings, and may not back up
their enthusiastic marketing support of NFV with aggressive product and sales support of the new offerings.
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SWOT A NA LYS I S
ST R E N GT H S
CENX has strong financial backing and an
excellent executive team; it is closing marquee customers and is profitable. That’s a
good list of strengths.
WEAKNESSES
Integrating Exanova into the carrier network
is a lengthy task that CENX cannot shoulder
alone for all customers, so it’s bringing on
integration partners, which is a good thing.
It is unclear, however, how much of its overall addressable market is going onto the SI’s
balance sheet.
O P P O RT U N I T I E S
Carriers have shown a new willingness to
work with smaller vendors to reduce the
complexity within their network, leading the
way for CENX and other startups to gain a
foothold in the telco network.
T H R E ATS
Some carriers are likely to implement CENX
in isolation for specific use cases, such as
mobile backhaul, but will not reach across
the organizational aisle in other use cases.