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Control Plane Framework Emergence and its Deployment Cost Estimation

Author

Listed:
  • Ahmad Mohammad Hassan

    () (Technology Management, Economics, and Policy Program, College of Engineering, Seoul National University)

  • Jorn Altmann

    () (Technology Management, Economics, and Policy Program, College of Engineering, Seoul National University)

  • Victor Lopez

    () (Telefonica I+D, Spain)

Abstract

Shortcomings of transport network technologies were the main driver behind strong efforts of standardization organizations to develop control plane frameworks since 2001. Despite the findings of previous studies that the control plane framework deployment will lead to a 50 percent decrease in OPEX and despite the fact that transport providers seek new ways to reduce network management complexity, lower operational cost, and to increase network utilization, transport providers mostly remain reluctant to deploy the control plane frameworks introduced by IETF and ITU-T. All studies about identifying the reasons have only investigated technical factors. These studies did not consider economic factors, although economic factors can have a huge impact on the diffusion of new technologies. In order to close this gap, we designed a cost model to calculate the deployment cost of new technologies in production transport networks. Apart from OPEX and CAPEX, which are considered to be the two main components of any cost model, we also included the depreciation cost of network components that are subject to be replaced during their useful lifespan. The cost model provides support for decision makers on when to switch to a new technology. To demonstrate the workings of the cost model, the cost for moving from a traditional network control system to a GMPLS control plane is calculated. Our findings suggest that the low GMPLS control plane deployment is not only rooted in technical factors but also in a lack of understanding of economic factors. Standard OPEX and CAPEX cost models underestimate the real cost that a network provider faces when migrating to a GMPLS-capable network.

Suggested Citation

  • Ahmad Mohammad Hassan & Jorn Altmann & Victor Lopez, 2012. "Control Plane Framework Emergence and its Deployment Cost Estimation," TEMEP Discussion Papers 201294, Seoul National University; Technology Management, Economics, and Policy Program (TEMEP), revised Jun 2012.
  • Handle: RePEc:snv:dp2009:201294
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    File URL: ftp://147.46.237.98/DP-94.pdf
    File Function: First version, June 2012
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    References listed on IDEAS

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    1. S. Illeris & G. Akehurst, 2002. "Introduction," The Service Industries Journal, Taylor & Francis Journals, vol. 22(1), pages 1-3, January.
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    Cited by:

    1. A. Mohammad Hassan & Jorn Altmann, 2013. "Disjoint Paths Pair Computation Procedure for SDH/SONET Networks," TEMEP Discussion Papers 2013107, Seoul National University; Technology Management, Economics, and Policy Program (TEMEP), revised Oct 2013.

    More about this item

    Keywords

    Multi-Layer Network Management; Control Plane Framework; Telecommunication Network Cost Factors; Cost Model; Transport Network; Techno-Economic Analysis; OPEX; CAPEX; Standardization.;

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
    • M15 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - IT Management
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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