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AT&T Inc. (T - Analyst Report) has decided to rename its Network Functions on Demand platform the FlexWare brand. The newly branded product will provide a small device option, enhanced feature functionality for security and expanded global availability.

AT&T’s innovative Managed Internet Service on Demand will enable its large business customers to easily add or change network services in near real-time. The company is aiming to extensively use software defined networking (SDN) and network function virtualization (NFV) techniques to enrich its network-on-demand offerings.

With AT&T FlexWare, business customers can set up multiple virtual network functions (VNFs), which may be utilize both as a router and a firewall, on a single FlexWare device and deploy them in different countries. They can manage their network functions via an online portal. More than 1,700 businesses from several industries have signed up for AT&T Network on Demand solutions.

AT&T aims to control 30% of its network using software (instead of hardware) by this year-end and 75% by the end of 2020. The company’s Managed Internet Service will use NFV to virtualise routing in its core network and at customer locations. Enterprise customers won't need to install router at their premises as the routing functions can be accessed from AT&T's core network.

The telecom infrastructure market is witnessing a technical change globally. So far, the main thrust of communications service providers had been on developing advanced hardware that enabled them to attain enhanced speed, scalability and reliability. However, recent developments suggest that operators are gradually shifting focus from a hardware-centric growth model to an IT/software-centric business model. The primary reason behind this shift is the significant growth of cloud-based virtual networking.

The SDN provides customers increased bandwidth utilization, higher reliability and reduced capital spending. Meanwhile, NFV is designed to consolidate and deliver the networking components needed to support a fully virtualized infrastructure – including virtual servers, storage and even other networks. It utilizes standard IT virtualization technologies.

AT&T’s Manged Internet Service will run on its Switched Ethernet Service via Network on Demand platform. The company has partnered with leading network infrastructure developers such as Cisco Systems Inc. (CSCO - Analyst Report) , Juniper Networks Inc. (JNPR - Analyst Report) and Brocade Communications Systems Inc. (BRCD - Snapshot Report) to develop SDN and NFV-based solutions for its customer premises equipment and core network architecture. All three stock currently carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Moreover, AT&T is working with Intel Corp. (INTC - Analyst Report) to optimize NFV packet processing efficiency for the AT&T Integrated Cloud. AT&T currently carries a Zacks Rank #4 (Sell).

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