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Communications In the Cloud Blog

Why Customers Are in Charge of SD-WAN Market Growth

February 6, 2018
SD-WAN Market Growth

By Alex Fayn, Co-Founder & CEO

Wrapping up an SD-WAN channel event a couple of weeks ago with S-Net’s closest partners, I reflected on how rapidly the market for cloud based technologies is changing, and the enormous impact of customers on the direction of its growth. It is hard to believe that the SD-WAN technology that barely earned its place in IT in 2015 has now matured into a solution ready for a major shift toward enterprises unifying their networks on their own terms. With their wide range of locations, connection types and business needs, companies seem to increasingly invest in SD-WAN as a service managed by carrier-agnostic providers with a wide portfolio of offerings.

We all know that the appeal of software defined networking lies in part in its support of what many CIOs care about the most: business outcomes and ROI. In a time when networking technologies such as traditional MPLS are becoming increasingly expensive for enterprise and SMB customers, SD-WAN provides comparable security and increases bandwidth and reliability at a fraction of the cost. In addition, managed SD-WAN services lift the weight of implementation, monitoring and maintenance, allowing IT departments to focus on the management of mission critical applications. Thus, it must come as no surprise that CIOs tend to favor SD-WAN as a managed service over plug-and-prey models.

But not all SD-WAN service providers are created the same. With their own bottom lines to protect, large telecom companies often base their SD-WAN offerings on an expensive set of circuits, including MPLS connections that enable them to combine product and service revenues in one offer. Aware of the added costs, many CIOs refuse to be tied down to one provider, and go with carrier-agnostic solutions instead to combine a wide range of connections from a variety of carriers into one service, as well as under one control pane. Enterprises with a highly distributed environment are reaping the most benefits from this type of managed SD-WAN service, because non-carrier providers are better suited for tying their existing heterogeneous network together, and finding the most innovative low-cost connectivity options for new locations.

In addition to custom networks, many businesses look for a set of applications that are tailored to their specific business needs. The rise in cloud technology is a fertile ground for the development of such custom solutions, as it eliminates the need for expensive hardware and proprietary software for each application. Many SD-WAN vendors have taken advantage of this shift toward the cloud, and have included a wide range of customizable features and functionalities in one device, including network analytics and firewall. Service providers can then build on such capabilities to combine their SD-WAN service with a wide range of offerings, becoming one-stop-shops for comprehensive, personalized communications solutions.

As SD-WAN technology is maturing, my customer conversations are revealing an emerging power shift that allows businesses to dictate the direction of market growth based on their needs. Where do you see customer needs shifting?

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