The telcos have signed onto the Open Compute Project, a non-profit set up by Facebook in which end-user companies get together and design their own, no-frills hardware including servers, network and storage gear.
The OCP members can include just the capabilities they need in a product, free of the "gratuitous differentiation" that bumps up prices in equipment from traditional vendors. They enlist low-cost manufacturers in Asia to produce the equipment.
The OCP has focused so far on cloud providers and large enterprises, but telcos will now submit design specifications for the powerful switches and other gear they use to run the world's communications networks.
Besides Verizon and AT&T, other new members announced Wednesday include Deutsche Telekom, Korea's SK Telecom and Equinix.
"These service providers and others are in the midst of huge transformation, and they're looking at all and every type of open-source technology to help them with that," said Nav Chandler, a research analyst at IDC.
They face several challenges, he said. One is that bandwidth needs are increasing 30 percent to 40 percent a year as more video and data traffic swamps their networks. Their revenues aren't growing in step, so they need access to lower-cost gear to build out their infrastructure.
Another challenge is that enterprises are moving more workloads into public clouds run by Microsoft, Amazon and Google. Those cloud providers are threatening the managed network services that telcos provide to move data reliably between corporate data centers.
To connect to the public clouds and keep providing those managed services, telcos need to adopt the emerging network technologies being used by those cutting-edge cloud providers, including software-defined networking and NFV, or network functions virtualization.
"They need to connect to these cloud data centers that are outside their control, and they can't do that economically with proprietary equipment from companies like Cisco, Nokia and Juniper," Chandler said.
Joining OCP should help them keep their costs down by making wider use of industry-standard hardware.
“AT&T will virtualize 75 percent of its network functions by 2020, and to do that, we need to move to a model of sophisticated software running on commodity hardware,” Andre Fuetsch, senior vice president of architecture and design at AT&T, said in a statement.
It's also about innovating faster. Gagan Puranik, director of SDN/NFV architecture planning at Verizon, said the OCP's collaborative model should help Verizon get new technologies into production more quickly, including future advances like 5G.
He expects Verizon to buy equipment from "a mix of traditional and non-traditional" suppliers, he said.
Facebook has already developed a pair of powerful OCP switches for cloud and enterprise use, and the new telco equipment could add to the pressure on traditional vendors.
Those companies aren't standing still. Nokia, which just bought Alcatel-Lucent, was among the new OCP members announced on Wednesday, and says it will incorporate OCP designs into future telco products.
Cisco noted that it's been a member of OCP since 2014. "We don’t view it as a threat," spokesman David McCulloch said via email. "Open standards, open source, and open-ness initiatives are only becoming more important to Cisco."
The OCP equipment takes time to design and manufacture, and it will need to be tested thoroughly for compatibility before it can be dropped into a telco infrastructure.
Still, a move toward wider use of commodity hardware can't be good for traditional vendors, and the cash-strapped telcos are clearly looking for a way to cut costs.