What is network functions virtualization (NFV)?

By IBM Services

Network functions virtualization (NFV) is “the decoupling of network functions from proprietary hardware appliances” and using these functions as virtual machines (VMs).⁽¹⁾ A network architecture concept, NFV uses IT virtualization technology to virtualize networks into building blocks that can connect or link up to produce communication services.

Although networks are meant to be virtualized using NFV, network functions aren’t meant to be virtualized. Firewalls, traffic control and virtual routing are three of the most common virtual network functions (VNFs). Other functions include working as an alternative to load balancers and routers.

NFV architecture

The European Telecommunications Standards Institute (ETSI) proposed the NFV architecture, which has helped to define the NFV implementation standards. In pursuit of improved stability and interoperability, these NFV architecture components were modeled on the implementation standards.

The following are the components of the NFV architecture:

  • VNFs. Software apps that generate network functions, including file sharing, Internet Protocol (IP) configuration and directory services
  • Network functions virtualization Infrastructure (NFVI). Made up of the following infrastructure components:
    • Compute
    • Storage
    • Networking

These components work from a platform to support software that’s needed for running networking apps.

  • Management, automation and network orchestration (MANO). Supports the framework for provisioning new VNFs (virtualized network function) and controlling the NFV infrastructure


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Why use NFV?

As of 2018, most personal computers and mobile devices are constructed around the x86 family of instruction set architectures.⁽²⁾ Virtualized networking components (VNCs) are used by NFV to bolster a hardware-independent infrastructure. Virtualized resources, including the resources used for computing, storage and network functions, can be placed on x86 servers and similar types of commercial off-the-shelf (COTS) hardware.

Also, the data plane and control plane within the data center and outside networks can be virtualized with NFV.

What are the challenges of using NFV?

Three technology components make up the core challenges around using NFV. They consist of the following:

  1. The NFV manager (NFVM)
  2. VNFs
  3. The NFVI

These three components are so incredibly tightly bound together that they result in added complexity and difficulty when deploying NFV at scale.

During the second quarter of 2019, Lean NFV worked to resolve this issue and developed a different method for the NFV architecture. In its white paper, Accelerating Innovation with Lean NFV (PDF, 896 KB), the authors argue the issues that hinder NFV include when the existing computational infrastructure is integrated with the NFV manager and coordination is required between various components of the NFV manager.⁽³⁾

The authors note that the three points of integration need to be simplified for innovation to be freely fostered on other elements of the NFV design.

There are different organizations currently competing against one another and working towards the goal of standardizing the NFV technology components. This lack of uniformity is one of the reasons for the complexity in these components. There has been no individual approach that’s worked for the whole industry and no standard that has been adopted or otherwise invested in.

What are the benefits of NFV?

There are plenty of reasons for organizations to use NFV, including the following benefits:

  • Better communication
  • Reduced costs
  • Improved scalability and resource management
  • Better resource management
  • Improved flexibility and accelerated time to market for new products and updates
  • Reduced vendor lock-in


Better communication and information accessibility

In addition to managing networks, NFV improves network function by transforming how the network architects generate network services. This process is performed by using an architectural and creatively designed method to link together different network nodes to produce a communication channel that can provide freely accessible information to users.

Reduced costs

NFV helps organizations reduce operating expenses because work can be performed virtually, resulting in fewer operating requirements.⁽⁴⁾ As an alternative for load balancers, firewalls and routers, NFV doesn’t require network proprietors to purchase a dedicated hardware device to perform their work or generate a service chain or group.

Improved scalability

Because VMs have virtualized services, they can receive portions of the virtual resources on x86 servers, allowing multiple VMs to run from a single server and better scale, based on the remaining resources. This advantage helps direct unused resources to where they’re needed and boosts efficiency for data centers with virtualized infrastructures.

NFV allows networks the ability to quickly and easily scale their resources based off of incoming traffic and resource requirements. And software-defined networking (SDN) software lets VMs automatically scale up or down.

Better resource management

Once a data center or similar infrastructure is virtualized, it can do more with fewer resources because a single server can run different VNFs simultaneously to produce the same amount of work. It allows for an increased workload capacity while reducing the data center footprint, power consumption and cooling needs.

Flexibility and accelerated time to market

NFV helps organizations update their infrastructure software when network demands change, starkly reducing the need for physical updates. As business requirements change and new market opportunities open, NFV helps organizations quickly adapt. Because a network’s infrastructure can be altered to better support a new product, the time-to-market period can be shortened.

Reduced vendor lock-in

The largest benefit of running VNFs on COTS hardware is that organizations aren’t chained to proprietary, fixed-function boxes that take truck rolls and lots of time and labor for deployment and configuration.


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What’s the difference between NFV and SDN?

NFV and SDN are often used in tandem with one another and they do share some similarities. They both use virtualization and network abstraction, although they’re different in how they separate functions and abstract resources. Both NFV and SDN use commodity hardware and help create flexible, programable and a resource-efficient network architecture.

SDN helps create a network that can be centrally managed and programmed by separating network forwarding functions. NFV shifts network functions from hardware to software, bolstering SDN with infrastructure that SDN software can run on.

NFV and SDN can be used together, depending on what you want to accomplish, and both use commodity hardware. With NFV and SDN, you can create a network architecture that’s more flexible and programmable and uses resources efficiently.⁽⁵⁾

NFV, SDN, and application programming interfaces

NFV is network component virtualization and SDN is network architecture that puts automation and programmability into the network by decoupling network control and forward functions. When NFV virtualizes all the infrastructure in a network, SDN centralizes the network’s control, creating a network that uses software to construct, control and manage it.

An SDN controller, northbound application programming interfaces (APIs) and southbound APIs are often included with an SDN. With the controller, network administrators can see the network and decide on the policies and behaviors of the adjacent infrastructure. Northbound APIs are used by applications and services to inform the controller of what resources it needs. Southbound APIs help the network run smoothly by processing information about the network’s state from the infrastructure and forwarding it to the controller.

NFV Use Cases

NFV is applicable across a wide range of network functions, including fixed and mobile networks.  Some leading NFV applications include:

  • Evolved Packet Core (EPC)
  • Software-Defined Branch and SD-WAN
  • IP Multi-Media Subsystem (IMS)
  • Session Border Control (SBC)
  • Video Servers
  • Virtual Customer Premises Equipment (vCPE)
  • Content Delivery Networks (CDN)
  • Network Monitoring
  • Network Slicing
  • Service Delivery
  • A variety of security functions – firewalls, intrusion detection and prevention systems, NAT, etc.


More resources for NFV / Network services



  1. SDxCentral Staff. “What is NFV (Network Functions Virtualization)? Definition.” SDxCentral, 26 August 2013. https://www.sdxcentral.com/networking/nfv/definitions/whats-network-functions-virtualization-nfv/
  2. Timothy Prickett Morgan. “A New Era In Servers Is Starting Now.” The Next Platform, 7 June 2019. https://www.nextplatform.com/2019/06/07/a-new-era-in-servers-is-starting-now/
  3. “Accelerating Innovation with Lean NFV.” Lean NFV, 2019. https://leannfv.org/wp-content/uploads/2019/04/2019-Lean-NFV-Whitepaper-Rev-A.pdf (PDF, 896 KB)
  4. “Network Functions Virtualization (NFV).” Techopedia. https://www.techopedia.com/definition/32042/network-functions-virtualization-nfv
  5. “What is NFV?” Red Hat®. https://www.redhat.com/en/topics/virtualization/what-is-nfv
  6. “NFV Use Cases”: https://www.networkworld.com/article/3253118/what-is-nfv-and-what-are-its-benefits.html