HP to Buy ConteXtream to Boost NFV Portfolio

ConteXtream in December launched ConteXnet 4.0, an SDN fabric for NFV environments aimed at service provider networks.

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Hewlett-Packard is adding to its network virtualization capabilities by acquiring ConteXtream, a vendor that offers a carrier-grade software-defined networking fabric for network-functions virtualization environments.

HP and ConteXtream have been partners in the network-functions virtualization (NFV) realm. For example, ConteXtream earlier this year joined HP's OpenNFV program. Now HP is looking to bring the company into the fold, announcing May 26 that it has signed a definitive agreement to buy ConteXtream. No financial details about the deal were released.

The deal is designed to bolster HP's capabilities in NFV, which company officials say is crucial to communications service providers (CSPs) that are dealing with rapid increases of traffic on their networks and competition from companies that offer over-the-top (OTT) services and are more agile and flexible when spinning out these services.

NFV enables CSPs to create and deploy more open, cloud-based architectures, giving them the ability to better compete in the rapidly changing network environment, according to Saar Gillai, senior vice president and general manager of HP's Communications Solutions business.

"We're moving away from being tied to dedicated machines to having a resource pool with automated, self-service mechanisms," Gillai wrote in a post on the company blog. "In the networking world, there are countless functions—firewall, caching, optimization, filtering, etc.—and a bunch of inflexible hardware to do those things. NFV is about saying, 'Why can't we put these various functions in the cloud? Why does each function need to be on specialized and dedicated hardware?'"

NFV and software-defined networking (SDN) offer the promise of more agile, programmable and flexible networks by removing the control plane and networking tasks from the underlying hardware and putting them into software. The ConteXtream technology will give HP more tools to offer service providers as they migrate to a software-defined infrastructure.

Officials with the 8-year-old ConteXtream in December 2014 rolled out ContexNet 4.0, a carrier-grade SDN fabric for NFV that is based on the framework being developed by the OpenDaylight industry consortium. Company officials at the time said ContexNet 4.0 will help carriers develop new revenue streams.

"Today's wireless carriers are facing a tipping point," ConteXtream co-founder, Chairman and CEO Nachman Shelef said in a statement. "They need to innovate beyond their traditional service model or become the latest commodity industry. ContexNet 4.0 allows service providers to optimize their network to meet traffic demands, control costs and introduce new services so they can open up new revenue streams."

In his blog post, HP's Gillai said ConteXtream's technology—including its SDN controller—complements HP's NFV offerings, which he said will be critical as the company competes in what some analysts have pegged to be an $11 billion market by 2018.

"ConteXtream's SDN controller platform complements HP OpenNFV solutions and aligns with NFV's evolution as an open source-driven architecture," he wrote. "With this acquisition, HP will increase its involvement in and contribute key ConteXtream capabilities to the OpenDaylight community."

Once the deal closes, ConteXtream will become part of HP's Communications Solutions unit, and Shelef will lead the ConteXtream business within HP, Gillai said.

HP has been aggressive in building out its NFV portfolio, including creating an NFV business unit and early last year launching the OpenNFV effort, a collection of software and services that enable CSPs to virtualize much of their core networking environment and adopt NFV technologies.

At the Mobile World Congress show in March, Spanish carrier Telefonica named HP as the technology provider and systems integrator for Unica, a project aimed at virtualizing 30 percent of Telefonica's infrastructure by 2016. Telefonica will leverage the OpenNFV platform in the implementation.

The ConteXtream deal comes as HP prepares to split in two later this year, with one company—which will be called Hewlett-Packard Enterprise—selling enterprise IT products, solutions and services, including networking technology. The other company, HP Inc., will focus on PCs and printers.