White Goods, White Boxes, and a view to 2014 (posted by gins, 3 Jan 2014)

When I was a kid, my parents used the term 'white goods' to refer to major appliances.  Although branded, they were pretty generic in their functions (remember this was the time before fridges with built-in displays or even ice makers) and differentiation at a given tier was primarily on price.  You bought it, it fit, and you hoped it was reliable.  This was the world of white goods.  

Fast-forward to 2014 and we have our own version of white goods for networking - 'white-box' switches.  Over the past two to three years, primarily in conjunction with SDN, the concept of a white-box switch has taken hold.  Here, generic hardware is provided by an OEM or ODM, offered as a reference design by a merchant silicon vendor, or created by a large cloud service provider.  It introduces some interesting business models, sometimes disruptive, for traditional networking vendors or even some of the new SDN specialists.   Do you continue to offer a complete stack under your own brand, consisting of the switch hardware and network operating system (NOS), or do you refer customers to a third party where they may purchase the hardware, later applying your NOS (and hoping that everything works as advertised).

However, the white-box switch itself is not the gist of the discussion, and too much has been made of the fact that these switches will result in generic offerings.   Hardware vendors still have the opportunity to differentiate based on functionality if they understand the intended application, while keeping COGS and TTM in-line.  And this doesn't apply only to the SDN/controller space.  There are many segments within the larger switching and routing market that require optimized hardware and where today's off-the-shelf designs or even platforms offered by some of the larger vendors don't meet the bill.  Or, hardware platforms that can better adapt to different NOSs, much like x86 supporting Windows, OS X, and Linux.   These are all areas ripe for innovation.   Moving up the stack, the value is also of course in the NOS, and here is where networking vendors can add differentiation, even across third-party hardware.

In 2014 we'll see continued innovation in this space balancing realistic expectations.  In the same way that 2013 served as a good gut-check with regard to SDN in general, tempering the promises of many of the startups in this space, the coming year will provide clarity on the how, what, and where of white-box switches.