Software Defined Networking Named Fastest-Moving Disruptive Technology

October 01, 2019

By Juhi Fadia, Correspondent

It’s no secret SD-WANs are replacing now-date VPNs, and while software defined networking works in harmony with MPLS, the move away from MPLS to SD-WANs and Internet overlay networks will replace that twenty-year-old technology as well.

Following on their State of Disruption and Cloud Channel Survey, AVANT Research & Analytics recently published their inaugural “6-12” report. Their new series of 6-12 Reports are designed to provide enterprise technology leaders with timely overviews of single topics for the next six to 12 months, with an eye towards the most disruptive technologies accelerating change and spurring innovation.

How real is the SD-WAN phenomenon and how long will it last? This wide-area networking technology, according to this complimentary report and similar industry analyst report, continues to enjoy substantial momentum as a better, more performant and cost-efficient means of supporting latency-sensitive applications.

Key aspects covered in this report include how enterprise customers can leverage SD-WAN towards increased network performance and/or lower costs, the types of applications best served by SD-WAN, and key players in the SD-WAN space, with sections on related issues including cybersecurity and infrastructure including firewalls and routers.

“We intended to create a useful guide for enterprise IT decision-makers considering adoption of SD-WAN,” said Research Vice President Ken Presti. “Through a combination of primary research, external research, and data collected through AVANT’s normal course of business, we explored the key considerations encountered by customers in evaluating this transition. It’s been very well-received. We’re proud to say that our inaugural 6-12 Report became the company’s most heavily-downloaded report in just two short weeks.”

The AVANT team polled 300 US-based enterprise decision-makers at either the C-suite or Management/VP-level in IT, security, or finance in five industries (Manufacturing, Financial Services, Healthcare/Medical, E-commerce, and Consulting/Business Services).

As part of the survey, respondents were asked to compare their current progress within a technology transition with where that progress stood at the end of 2018.

SD-WAN won the prize as the most disruptive technology in AVANT’s 2019 State of Disruption Study evaluating the most disruptive technologies changing today’s IT landscape, including SD-WAN, UCaaS, Hyperscale Platforms, Colocation, and Managed Security Services.

“Our goal was to measure how rapidly the market is transitioning from a legacy technology to a newer technology that is either replacing or supplementing it,” Presti said. “The Rate of Disruption Index mathematically measures the year-over-year shift in market displacement, based on responses to the survey conducted this spring. The RDI is useful for comparing the significance of market impacts in a way revenue numbers and or revenue growth alone cannot.”

Using this metric, SD-WAN is posting a year over year 13% RDI in supplementing or replacing non-SD-WAN enabled networks. This RDI is nearly twice as great as the Cloud infrastructure with a 7% RDI replacing legacy on premise servers to cloud platforms, as well as twice as great as the UCaaS 7% RDI replacing legacy PBX (News - Alert) platforms.

The data shows that SD-WAN adoption is fastest in smaller companies with an RDI of 15%-16% for companies $1M to $10M and $10 to $100M, with $1B companies generating an RDI of 8%, still beating UCaaS and Cloud adoption.

“It is AVANT’s belief that SD-WAN will continue to make ongoing incursions into the higher end of enterprise, beginning at remote offices, and other edges of the network, and then reaching steadily closer towards the core,” the report says.

According to International Data Corporation (IDC) the infrastructure market for SD-WAN is predicted to expand at a 30.8% compound annual growth rate (CAGR) from 2018 to 2023, reaching $5.25 billion, while competitor Frost & Sullivan (News - Alert) is measures the SD-WAN market at $593 million in 2017, but expecting it to reach $4.4 billion by 2023.

AVANT’s new research demonstrates that 68% of Trusted Advisor channel sellers believe customers will buy SD-WAN by 2021, up from 49 percent in 2019.

The report also revealed that, as opposed to some pundits’ claims that MPLS is going away, “SD-WAN’s market uptake is not yet coming at the expense of legacy MPLS technology, given that 53 percent of $1B enterprises still plan to invest in MPLS, while the lower end of the market is displacing MPLS much more quickly.

All In the Mix

“The emergence of a widening variety of latency-sensitive and bandwidth-heavy applications is driving a need for increased demands on corporate networks, while at the same time reinforcing a certain cost consciousness and security awareness,” the report also says. “Increasingly, data traffic no longer lives solely within the confines of a corporate data network. The trends to leverage cloud platforms such as UCaaS, CRM, and email are also changing corporate WAN requirements. SD-WAN can meet these needs and can be used in conjunction with any other network technologies, including broadband, MPLS, Ethernet, 4G/5G wireless, DSL, private fiber networks, and satellite.”

Several industry experts weighed in as part of the report’s narrative.

“Mid-size and small enterprises are moving quickly to cloud, with large enterprises consideration rates increasing more each day” said Gary Levy, VP Worldwide Alliances and Channels at Oracle Communications. “As mission critical applications are sourced across cloud environments, enterprises are re-thinking how they are leveraging MPLS. We find that enterprises are reducing expensive point to point MPLS circuits, increasing usage of less expensive broadband internet, and rapidly deploying SD-WAN.”

“It is a simpler and more efficient way to handle routing and unify the functions of multiple devices,” said Paul Weiss, Vice President of Helm Partners, LLC, a Pennsylvania-based Trusted Advisor. “It can also drill down to help me understand how applications are being used, the performance across my connections, and how my sites and my people are doing. There’s a significant advantage to business intelligence and the ability to troubleshoot as compared to traditional routing and firewalling models. You can also use these capabilities to build up your uptime or strengthen security.”

According to AVANT’s assessment data, most companies are coming to SD-WAN from a MPLS environment (62 percent), and 40 percent report a near-term plan to keep their original network, while a nearly equal percentage plan to replace their original network sooner rather than later.

Approximately 40 percent are aiming at an SD-WAN set up that includes Dual Internet connections and 39 percent are planning a hybrid environment that includes MPLS. Products and technologies that users may choose to displace through the adoption of SD-WAN include routers (55 percent), standalone firewalls (47 percent) and WAN optimization (23 percent), given that these functions can now be delivered by other means.

“Oftentimes, a discussion on SD WAN begins with a conversation on an entirely different subject – most likely a value proposition around UCaaS, SaaS, or some other application that requires a substantial amount of bandwidth or is otherwise latency sensitive,” the report continues. “In such circumstances, the discussion can turn to SD-WAN as a means of providing the network power necessary to support the higher-level application that is intended to provide a competitive differentiator for the customer.”

This very rich report explores the offerings of all the major players in the SD-WAN marketplace, one which has experienced a continual wave of consolidations. While Cisco’s (News - Alert) acquisition of Viptela, and VMware’s acquisition of VeloCloud made the biggest headlines in 2017, there are many pure-play SD-WAN companies with momentum, as well as large networking companies who are only now rolling out their SD-WAN strategies. A Futuriom analysis predicts that Aryaka Networks, Cato Networks, CloudGenix, FatPipe, and Silver Peak (News - Alert) Systems make the most likely acquisition candidates going forward.

 The Avant report shared these “Points to Ponder”:

  • SD-WAN is showing rapid market uptake, meaning that many of your competitors may be taking advantage of its benefits.
  • If you’re doing UCaaS or CCaaS, office 365,, AWS, Azure, Google (News - Alert), or cybersecurity, SD-WAN may in effect be a necessary network upgrade.
  • Costs versus value: Bear in mind that some estimates for cost reduction associated with SD- WAN may be overstated. Your mileage may vary. However, the fundamental reason to explore SD-WAN is based on the network performance and the latency-sensitive applications that are enabled by it.
  • SD-WAN will not immediately displace MPLS across the broad market. But the continued use of MPLS should not delay trialing or even implementing SD-WAN along with it.
  • Many carriers are adopting SD-WAN, even though they can often make more money by selling MPLS. They do so out of recognition of the direction of the market plus their own need to evolve.
  • Firewalls and routers will potentially be displaced by multi-function SD-WAN boxes, meaning that your current infrastructure mix is likely to change over the course of time.

Avant’s report is a “must-read” for decision makers laying out their roadmaps for 2020 and beyond and is available for a free download here.

Juhi Fadia is an engineer, analyst, researcher and writer covering advanced and emerging technologies.

Edited by Maurice Nagle

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