“Virtual CPE (vCPE) is an alternative way of delivering broadband services to subscribers where most of the CPE functions are pulled in to the operator’s network and located near the service edge. In the new network architecture, the CPE acts as a simple Layer-2 forwarding device that helps a business or residential subscriber to connect to the service provider network. Services such as DHCP, Firewall, NAT, Routing, VPN, etc. are delivered by Virtual Network Functions (VNFs) running at the Telco datacenter as a Virtual Machine (VM) instance configured for each broadband subscriber.”
The concept of virtual customer premise equipment (vCPE) is an exciting one. It’s the equivalent to what the iPhone did for mobile handsets. They both allow for increased flexibility via almost limitless upgradability / configuration in software without requiring constant replacement of hardware. The iPhone’s lack of keyboard (in hardware), plus a big touchscreen, allowed for vastly more flexibility of interaction via software. Without the raft of software / apps that work on the iPhone, it would actually be less useful than preceding phones.
The same is likely to be true for vCPE. The VNF is one level at which software will play a key part to the success of vCPE. The other is in the operational management / administrative tools that will help to configure, monitor and manage the CPE / VNFs.
The diagram below shows a high-level block diagram of a vCPE (this one from Calsoftlabs).