Disclaimer: The author has no business relationship with Pica8 or any of the companies he interviews or writes about.

Introduction:

Tired of all the SDN and network virtualization hype? And that “open” networking has morphed into the new term for “closed, vendor proprietary boxes with a bit of user programmability?” So are we! That’s why this inside look at SDN/Open Networking start-up Pica8 is so refreshingly different.

This author believes the future of open networking is Open Source and networking OS company software running on bare metal/white box switches. That’s what Pica8 is all about. It’s the real deal!

Company Overview, Product Positioning & Competition:

Pica8 is a networking software startup with headquarters in Palo Alto, CA and software development/testing R & D in Beijing, China. The company, founded in 2009, got started in 2010 by installing its homegrown PicOS™ on OEM, bare metal switches from two Taiwanese vendors (now seven). Those boxes were sold as “pre-software loaded” white box switches. Pica8 has evolved to also selling their software to customers who buy the bare metal switches directly from the vendor and port PicOS™ by themselves or a systems integrator/sales channel partner that does that for them.

Pica8’s target customers are regional service providers, which include: ISPs, web/compute server hosting, regional cloud service providers, telcos, cable/MSOs, municipalities offering business and residential broadband, and other fiber to the premises (FTTP, FTTN, or FTTx) access network providers. One promising FTTx area for the product is broadband network infrastructure for new office buildings and business parks.

A typical FTTx deployment topology is shown below. Uplinks on the bare metal switches can be used to create a mesh or ring core, typically the core would be 2 or 4x10G. Hanging off the core are points of presence, which are typically redundant and delivering 10G to the access layer. The access layer is typically 1G today, and could be an aggregation of either GPON devices, or vCPEs which are hardened appliances offering NFV services (firewalling, NATing, QoS, etc).

CAPTION: FTTx service providers can deliver bundled services over a shared or point to point fiber access network.  Broadband subscriber access is typically at 1 G b/sec.  Critical requirements include: service redundancy, support of BOTH OpenFlow & legacy bridge/routing, and service automation.

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Pica8 says that “by leveraging white box networking, service providers can sell new services to light up their small and medium business (SMB) customer network applications at buildings and multi-tenant locations, thereby offering a more complete solution to end users and increasing revenue per subscriber.”

From the company’s website:

“Pica8’s leading ‘one stop’ approach is driving rapid growth, and we have over 400 customers worldwide, including web services companies, global carriers, enterprises and leading research labs.”

“PicOS provides extensive support for traditional Layer-2 / Layer-3 switching and routing protocols and delivers SDN solutions through Pica8’s adoption of OpenFlow. PicOS is the only Linux-based network operating system that supports an industry-standard CLI for Layer-2 / Layer-3, unmodified Linux, and OpenFlow 1.4. Pica8 makes white box adoption seamless by providing PicOS, on both pre-loaded switching hardware or as standalone software on a growing list of compatible white box switches.”

Pica8’s competition is mostly legacy switch/router vendors (e.g. Cisco, Arista, Juniper, Alcatel) who have provided some degree of user programmability/”open networking” capability within their otherwise proprietary boxes. A much more truly open approach (in this author’s opinion) is to run Open Source and/or 3^rd party Network OS software/protocols on bare metal switches.

Networking software companies like Cumulus Networks and Big Switch are NOT perceived as competitors, but more like collaborators in the movement towards true vendor neutral, open networking. In fact, Pica8 does collaborate with those networking software companies at the Open Compute Project (OCP). They believe the end game is to educate the market and ensure a robust supply chain for open networking software on white box/bare metal switches.

Who owns the company? Pica8 has just over $20M in VC funding (after Series B), lead VCs are Vantage Point Capital, Mitsui, and Pacific Venture Partners.

The Deliverable – Pica8’s Networking OS Software Package:

PicOS™ is said to be the first Linux-based network operating system that enables customers to easily integrate Layer-2 (Spanning Tree, MPLS, etc.) / Layer-3 (IP & routing) protocols stacks with Software Defined Networking (SDN). Shown in the figure below, PicOS™ is actually much more than a Linux based OS. It supports three distinct operational environments:

• Linux tools for DevOps.
• Virtual ASIC compatibility/mediation sublayer to accommodate different Ethernet switch silicon used in the underlying bare metal switch.
• Open Virtual Switch (OVS 2.3) module which supports Open Flow v1.4 and also simplifies VxLAN (L2 tunneling protocol) in Network Virtualization deployments .

Also included in the Pica8 software package are:

• CrossFlow, which provides software tools to all three environments) and
• L2/L3 protocol stacks for bridging/routing and Ethernet MAC frame/IP packet processing.

A key benefit of Pica8’s software package is that their customers can support BOTH traditional hop by hop (layer2 bridge/L3 routing) AND SDN/OpenFlow (with the bare metal switch serving as the Data Plane Forwarding Engine) as well as network virtualization using OVS. Also, the customer can dynamically re-configure the switch to/from conventional L2/L3 protocols to SDN/Open Flow packet forwarding mode or to network virtualization mode.

“Pica8 sees the need to add more breadth to our portfolio, thereby offering more of a one stop shop for these (regional service) providers,” said Steve Garrison, VP of Marketing at Pica8. “Over the past six months, we have introduced MPLS Labeled BGP, 100 GbE switches, network virtualization, OpenStack and VXLAN support. With this new 48-port PoE switch, Pica8 is filling a network need for regional service providers to sell services right into the customer premises.”

The Move from Pre-Loaded White Box Switches to Software Only:

From 2010 to 2013, Pica8 sold only pre-loaded white box switches. In 2014, the company started selling “software only” packages for bare metal switches (in addition to pre-loaded white boxes). 5% of sales were software only that year. Steve Garrison says:

“So far this year (2015), we are over 20% in software only sales and I expect that to increase to ~50% next year. The data speaks for itself. Apparently, our customers are learning and gaining trust in this new open networking, supply chain business model.”

Author’s Note: Users that adopt the “do it yourself” bare metal switch model usually have sophisticated IT/Network Engineering departments with experience porting 3^rd party software and services to bare metal switches. Those that chose a systems integrator or sales channel support partner want a “big brother” to help them. That’s what Dell and HP are trying to be for their bare metal switch customers.

Pica8 customers can also buy direct from the bare metal switch equipment makers, such as Edge-Core. The company’s customers have 15 bare metal switch vendors to choose from. Their white box ecosystem partners are listed here.

Steve said, “We see largely cloud and web scale companies doing this today. Having said that, we believe these sales will pick up over time.”

We think that “truly open” software running on bare metal switches is not only more flexible and user friendly, but also much less costly. Indeed, the savings can be significant. Last year, the average selling price of 10-Gigabit and 40-Gigabit Ethernet legacy vendor switch ports was $308, while the price on bare-metal hardware was $112, according to IHS- Infonetics. Open hardware from the Open Compute Project (led by Facebook) will help to drive the cost of those ports even lower over the next four years, according to the market research firm.

Other Voices:

Here are a few supportive opinions (on open networking software running on bare metal switches) from leading market research analysts:

• Service providers are a growing channel for network infrastructure,” said Lee Doyle, Principal Analyst at Doyle Research. “As more services move to the cloud, service providers now offer complete service delivery and management services, and are a channel for software networking vendors (like Pica8) that offer services that are dynamic and easy to scale.”
• “Service providers want more than point solutions from their vendors,” said Zeus Keravala, Founder and Principal Analyst at ZK Research. “Companies that see the service provider market as a channel and a means to reach the SMB space will ride a huge wave in the coming years. We see share shifting to service providers over time, and Pica8 is positioning itself to take advantage of this tectonic shift.”
• “The number one reason enterprises will start buying bare-metal switches in the next few years is so they can program them like they do Linux servers, said Cliff Grossner of IHS-Infonetics. “”When you have a closed box with a CLI (Command Line Interface used for configuration), you don’t have full flexibility to do what you want,” he added.
• In response to the June 29, 2015 announcement that TouIX, one of France’s leading Internet exchanges, is using Pica8’s network operating system on white box switches to program and optimize its exchange fabric: “The Internet exchange environment is a great beachhead for OpenFlow / SDN technology,” said Paul Parker-Johnson, senior analyst with ACG Research. “These providers essentially interlink adjacent providers in a hub and spoke fashion, creating a convenient means for multiple network providers to interconnect their networks. Exchange networks are typically only switched and therefore are prone to broadcast storms. OpenFlow creates a very controlled means to program point to point connections and thereby eliminates any chance of broadcast storms whatsoever. With Pica8’s software, TouIX avoids network outages and congestion caused by broadcast storms, thereby increasing customer satisfaction and uptime.”

Conclusions:

Pica8 is making good progress. The current geographic breakdown of total sales is: 50% North America, 30% Japan, 20% ROW (which is largely EMEA, China and Korea). They’ve evolved from selling their networking software loaded on white box switches to ALSO selling their software as a stand alone product compatible with their bare metal switch partners.

Pica8’s success indicates that bare metal switches are gaining market traction –with or without pre-loaded software. We noted that in an earlier article, which highlighted IHS-Infonetics’ forecast of solid growth for bare metal switches over the next five years (till 2019).

We think that legacy switch/router vendors like Cisco, Juniper, Arista Networks, Alcatel-Lucent, Huawei, etc. are now and will be seriously threatened by this new business model. Pica8 seems to be in the right place at the right time with the right software product and a long list of compatible bare metal switch vendors and channel partners. Ultimately, we believe their biggest competition will be from consortium developed Open Source software (e.g. Open Daylight, ONOS/ON.Lab, Atrium/ONF, etc) which will run on those same bare metal switches.

References:

• Pica8’s network operating systemdata sheet / features> (PDF)
• List of bare metal switches (supported by Pica8’s operating system)
• White box/ bare metal switch partners
• How portable is your network OS? This blog describes the elements of the network OS that need to match to have compatible hardware. From ASICs, to the CPU, the drivers and libraries for the LEDs, Fans, temperature sensors.
• This Video provides an overview of theL2 / L3, OpenFlow and Linux story
• Pica8 Global Reseller List These are Pica8’s lead partners. They give preference to those that move more product. Synnex / North America, CrossHead / Japan and Stordis / EMEA are their lead regional integrators
• 2014 Open Server Summit article which explained how Pica8 was integrating Open Flow into networking software that runs on white box switches and provided a nice illustration.