Nuage’s Virtualized Services Platform, which executives hinted at in January, incorporates a controller, virtual routing and switching, and a virtualized services directory. It operates in layers two through four of the network stack, building tunnels between virtual machines running in the same server rack or even in different racks at different data centers as easily and quickly as one cell phone can connect to another one, said Lindsay Newell, head of portfolio marketing for Alcatel-Lucent’s networks group. It works with cloud-management software from OpenStack, CloudStack and VMware.

Trials of the Nuage software begin this month. Trial customers include telecommunications service providers SFR and Telus, as well as the University of Pittsburgh Medical Center. Nuage (French for “cloud”) will make the product commercially available within three months or so, Newell said.

As soon as next year, he said, Nuage will follow up with software for establishing software-defined virtual private networks. It should be able to connect multiple enterprise network locations, including private or public data centers, through a virtual, programmable wide-area network, avoiding the need for expensive and time-consuming manual provisioning.

That’s later. For now, Nuage will have to prove that its overlay product can deliver on its promises and do more than what it calls first-generation SDN offerings from Big Switch, Nicira and others.

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Most network admins know what they want to do with SDN, which virtualizes physical networking gear so administrators can tweak their networks without unplugging boxes and moving cables. Admins want to deploy applications and services more quickly. Many also want to use it to cut down on mistakes and get new customers running as soon as possible. But problems loom. Admins expect SDN to cost a lot of money and possibly lead to security concerns. And they don’t think their colleagues know about SDN in the first place.

Such are the contradictions that resulted from a February and March survey of 237 enterprise network decision makers, sponsored by the Swedish SDN company Tail-f Systems. The results point to the lack of real knowledge about what SDN is and how to implement it. There’s still no shortage of hype, though, and with vendors using different definitions and trying to drive their own standards, it’s hard for everyone to agree on common terms.

So far, 65 percent of survey respondents said their companies are in SDN trials, have implemented SDN or are implementing it now. That number will keep going up. A February GigaOM Research report (subscription required) forecasted the global SDN market will swell from $320 million in 2014 to $2.45 billion in 2018. But how soon the hype will go away and genuine understanding will replace it is anyone’s guess.

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Toward that end, the company has secured $17.3 million in Series A funding, bringing the total the company has raised to $18.6 million. The Innovation Network Corporation of Japan led the round, which also included participation from NEC Capital Solutions and NTT Docomo Innovations Ventures.

Midokura’s software virtualizes the network to let OpenStack cloud-management software rapidly create virtual networks and manage virtual routing and switching. Unlike some SDN startups, Midokura’s software does not use the OpenFlow networking protocol. Midokura executives see Nicira as a major competitor, and to a lesser extent Big Switch, even though those companies incorporate OpenFlow in varying degrees. Since releasing a beta version of its overlay in October, the company has found a customer in one large unnamed technology company in the United States, said Midokura’s chief strategy officer, Ben Cherian.

Midokura executives are changing roles. Dan Mihai Dumitriu, chief technology officer and a co-founder, is becoming CEO, while the CEO until this point, co-founder Tatsuya Kato, is becoming board chairman.

Midokura has managed to develop a product and take on venture funding after realizing its IaaS dreams weren’t going to pan out — not immediately, anyway — and changing course. Now, with Microsoft, Rackspace and especially Amazon becoming larger IaaS providers, the move looks like a good one. If Midokura can sign up a few IaaS customers, it could capture a foothold in the SDN market, which does not yet have clear leaders.

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Big Switch’s new Switch Light software implements the OpenFlow networking protocol in physical and virtual switches. It lets data center administrators automatically and centrally send out policies from one location when new switches are added to the network, instead of having to go through with a time-consuming, hands-on process.

The open-source version of Switch Light is available for free because “we want to make sure (OpenFlow) industry standards are enabled in the data plane,” said Jason Matlof, vice president of marketing at Big Switch. The commercial version comes with technical support and is more scalable and highly available than the open-source version, Matlof said.

Switch Light is based on existing open-source technology developed a few years ago under the name Indigo. Customers can sign up to use the Switch Light software under a licensing agreement along with Big Switch’s other software-defined networking products — the Big Switch Controller for the network’s control plane, the Big Virtual Switch and the Big Tap monitoring program.

Consider the news another blow to Cisco, as the Big Switch software is aimed at customers that want to move away from lock-in from the legacy network hardware vendor and shift elements of their network stacks to white-label suppliers. Cisco still holds 65 percent of marketshare for Ethernet switches. Arista and Juniper play here, too.

As I reported earlier this month, Quanta Computer is keen on selling network gear such as switches directly to companies through a newly formed subsidiary, Quanta QCT, just as it has shifted from a primarily original-design manufacturer to a direct seller of servers. Quanta and other commodity switch makers, such as Supermicro, could benefit from the Switch Light release as well.

All eyes are on Cisco and Arista to make the next move. Meanwhile, as the Switch Light affords Big Switch a more rounded out product line, the company could again look like a good buy, just as it did last summer.

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SDN involves the abstraction of the network’s brains, as it were, from its hardware. This is analogous in some ways to server virtualization, in that it makes it much easier to build smarter systems on top of commodity hardware. Juniper’s take on this sees the network as four layers, namely forwarding, control, services and management — in Juniper’s vision, everything but the forwarding layer should be centralized.

Lin, who joined Juniper through the company’s acquisition of SDN specialist Contrail Systems, said at GigaOM’s Structure:Data conference in New York on Wednesday that federating the control function and eliminating “manual error-prone processes” would help the big data because:

“We’re seeing a huge opportunity here to reposition the role of the network as a curator of big data and make sure that role is easily exposed through abstractions of the network. The role of the network is interesting because the network is the only thing that’s globally pervasive and … uniquely knows a lot of the contextual information that is required to drive insights back into the system.”

Lin argued that this “rich context” would enable new types of business models such as collaborative data exchanges, without anyone needing to worry about the technology architectures involved. “The role of the network is changing quite heavily and the pace of innovation for hyperconnected data is really astonishing,” she added.

Check out the rest of our Structure: Data 2013 coverage here, and a video embed of the session follows below:

A transcription of the video follows on the next page

Go to page 2 (of 2) on GigaOM .

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Jafco Ventures led the funding round, while previous investors Lightspeed Venture Partners and Norwest Venture Partners also contributed. The company has now raised a total of $28.85 million.

Pertino has more than 700 customers. It has aimed at small and medium-sized businesses, and in time it will look to add enterprise customers, Pertino Co-founder and CEO Craig Elliott said.

The software lets customers easily spin networks up or down to meet operational needs, just as they can do with compute or storage power on Amazon Web Services and other public clouds. Also, the virtualized networks can move around to other clouds Pertino runs, in case of a natural disaster. The virtual WAN is designed to be as secure as the local-area network (LAN) that employees use inside a single office.

Software-defined networking (SDN) remains hot. But it isn’t necessarily one big market. While Big Switch Networks, Embrane and Nicira target SDN deployments in the data center, Pertino works on servers elsewhere. That’s why Elliott said doesn’t believe Pertino will take away business from those other SDN businesses and vice-versa. However, all of those companies focus on separating the control plane and the data plane with software that precludes the need for appliances that take up space and require considerable capital expenditures.

Cisco, Juniper Networks and other companies also are using SDN to optimize wide-area network (WAN) traffic, according to a GigaOM Research report (subscription required).

With plenty of SDN hype still hanging around, it’s not hard to imagine more companies jumping into the SDN-via-cloud market. But use cases are few and far between, and that could mean new entrants might have to wait before racking up a long list of production-scale clients. Pertino, meanwhile, could maintain its lead.

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Earlier this week I wrote about how NTT Communications has been rolling out SDN at multiple data centers around the world, to automate network configurations and provide other benefits. I also learned about how Peer 1 Hosting has signed up for SDN vendor Embrane’s software to round out the Peer 1 Infrastructure-as-a-Service (IaaS) cloud offering, and I found out that SunGard has started using those same products to lower response times for its Recover2Cloud disaster-recovery enterprise cloud. The increased agility from SDN and other innovations lets SunGard promise response times that are 30 to 40 percent shorter, and the company expects to offer better service-level agreements to its own customers as a result.

Meanwhile, SDN company Nicira, which VMware acquired last year, has identified Rackspace, AT&T and DreamHost as customers. All three of those companies provide hosting services alongside other offerings.

In 1999 or thereabouts, service providers were quick to jump onto the multiprotocol label switching (MPLS) bandwagon as a way to help information travel faster on a network, said Ram Shanmugam, SunGard’s senior director of product management. Now many of those same companies are standing up as early adopters of software-defined networking.

And as that happens, it’s only natural for enterprises to witness the benefits of SDN and decide to give it a try, Shanmugam said. And thanks to SunGard’s market position, the shift could happen soon: Over 70 percent of Fortune 500 companies use SunGard for disaster recovery, Shanmugam said. Going forward, more SunGard clients could get exposed to the perks of SDN, as the company has been discussing the inclusion of SDN as well as software-defined storage for SunGard’s enterprise cloud.

More SDN products hitting the market will also speed up adoption of the technology, which virtualizes networks and enables users to automatically provision firewalls and load balancers in a few minutes — something that took an engineer hours or days to do with a hardware appliance. The vendors are ready for the demand increase, or getting closer to that point. Networking hardware vendor Juniper Networks, soon after acquiring startup Contrail Systems, announced plans to release products later this year and next year that will allow for consolidation of hardware and connect network services on multiple devices. Cisco said in November 2012 it would buy Cariden, a company that’s come up with SDN strategy. And just last week F5 Networks, another hardware vendor, acquired LineRate Systems, which is looking to help companies take on more web traffic with more easily scalable networks, as my colleague Derrick Harris wrote.

So far, the promise of better agility has been one of the best motivators for companies to try out Embrane’s SDN products, and cost savings have taken a back seat, said Dante Malagrinò, Embrane’s CEO. This is somewhat a contrast to the adoption of server virtualization, where costs savings drove adoption among enterprise customers and the benefits of agility were only perceived later.

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The Spanish telco and Japanese vendor have a fair amount of history together, with NEC providing the platform underpinning Telefonica’s small-business software-as-a-service (SaaS) offerings. Now that relationship is being extended to co-develop software-defined networking (SDN) and network function virtualization (NVF) technologies.

The precise direction of that collaboration is a mystery for now, but here’s the background. Like other carriers, Telefonica is keen to re-engineer its networks to reduce management complexity and allow the rolling-out of new services that can only work across a virtualized, software-centric network. And along with its rivals, Telefonica is involved in a global specification-setting group for this very purpose – after all, interoperability is essential when you’re designing the telecoms networks of the future.

However, when specifications are being set, it helps to be in the driving seat; hence Telefonica’s new partnership with NEC.

“Our idea is to have some kind of standardized solution, not just for Telefonica but for the rest of industry,” Enrique Algaba, Telefonica’s director for network virtualization, told me this morning.

All this plays into an evolving conception of SDN, which sees the technology as applicable to entire telecoms networks, not just to data centers (Ericsson is particularly keen on this interpretation, as it reiterated in a whitepaper yesterday). This already goes beyond the original purpose of network virtualization, but Telefonica appears to be taking the concept even further, all the way to the set-top box.

“We’re thinking these technologies could be applicable to access – also in the fixed line,” Algaba said. “There are some interesting use cases in virtualizing home equipment, to simplify the architecture we have in the home network.

“From the Telefonica point of view, this is something new so we are pushing this in the market. We think we have to be here in order to steer in some way this new approach, in order to have our requirements included.”

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Ericsson Cloud System, which will hit availability in the first quarter of 2014, targets mobile operators in particular. It incorporates an upgraded Cloud Manager, which is Ericsson’s operations support system, alongside a new Cloud Execution Environment that’s based on OpenStack and the KVM hypervisor.

This all runs on existing Ericsson Blade System (EBS) server clusters and Smart Services Routers (SSR), and the general idea is to enable virtualized environments across the network, from the base station to aggregation nodes and business support systems.

“Cloud services need to be distributed and networks — including computing and storage capabilities — need to be elastic on an end-to-end basis,” an Ericsson statement reads. “This combination will bring a new set of capabilities that doesn’t exist today… It enables distributed cloud capabilities such as computing and storage capabilities in the network, resulting in a better experience when using cloud applications, and more efficient utilization of network resources.

Ericsson’s take on SDN is key to this approach. The company sees most people’s interpretation of the concept as overly focused on the data center, whereas it wants to push the idea of SDN as covering a carrier’s entire network, with operational and business support systems also in the mix.

The benefit, it argues, would be to make resources elastic, to cope with an application’s bandwidth or quality-of-service requirements on-the-fly. By doing so, Ericsson says, the operator can make its own business more efficient, then perhaps use freed-up resources to provide cloud compute and storage services to others.

“There are lots of advantages,” Magnus Furustam, the head of Ericsson’s Core and IMS business, told me today. “Time to market, simplifying operations, but also the innovation that is enabled. By providing a virtualization layer, you make it possible for the operator to [insert] new functionality in the network where it is needed.

“We think it’s important that this is not a disruption –- we’re not asking our operators to throw away their existing infrastructure. Based on that hardware we can upgrade that to support first of all virtualized environments, and if that is not the case we can add hardware, say a board that supports virtualized environments.”

The Ericsson Cloud System will be shown off at Mobile World Congress in Barcelona later this month, where the company will also launch a new “unified” content delivery network (CDN) system called Media Delivery Network.

The new CDN system, designed to help both fixed and mobile operators get into video delivery, combines Ericsson’s existing packet core and radio technologies with new management and service exposure layers. This will let operators do things like select the best CDN in order to optimize traffic, and cache over-the-top (OTT) content — in other words, third-party content — in order to offer the OTT content providers new guaranteed quality-of-service levels.

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