Network connections are becoming more complex as more devices require connectivity from infinitely more locations. This proliferation of IoT has driven demand for software-defined solutions to optimize networking costs, improve enterprise agility/scalability, and enable the integration of cloud applications. Although the emergence of secure access service edge (SASE), which integrates SD-WAN with edge security, has contributed to some players labelling SD-WAN as outdated. However, global technology intelligence firm ABI Research believes that there is still a considerable market opportunity across the entire software-defined portfolio, for innovative suppliers looking to keep up with enterprise vertical demand.

There are certain suppliers leading the way in the SD-WAN marketspace including Cisco, VMware, and Aruba. However, key cloud native innovators such as Cato Networks and Aryaka Networks are challenging the traditional leaders, by offering solutions that shift computing to the cloud, enabling enterprise verticals to develop versatile and scalable cloud native networking strategies. These providers will become increasingly important given the benefits that shifting network infrastructure and applications to the cloud can bring to nearly all enterprise verticals.

“As enterprises shift toward ‘cloud native’ strategies, it is imperative for suppliers to keep in lock step with enterprise demand by providing universal access to network Points of Presence (PoPs). For SD-WAN suppliers, the most efficient strategy would be the formation of partnerships with public providers, such as Equinix or Megaport,” explains Reece Hayden, enterprise connectivity and distributed edge computing Research Analyst at ABI Research. “This would provide them with near-immediate global coverage with limited set-up costs.”

Communication service providers, appliance vendors, and enterprise verticals still have a lot to gain from SD-WAN. “Lateral thought and product innovation remain the key requirements for suppliers within the enterprise connectivity ecosystem. Suppliers must continue to drive innovation across the entire SD-portfolio and offer solutions that seamlessly integrates the traditional (office) and new (home) workplaces with complete visibility and universal cloud accessibility,” notes Hayden.

ABI Research projects that the next stage of innovation within SD-WAN will be led by the integration of 5G into the enterprise networking ecosystem. This innovation will be led by quality of experience demand, the rise of multi-access edge compute, and improvement in security create by network segmentation. But, given the immaturity of enterprise 5G infrastructure, it is unlikely that this will be universally possible for 3-5 years. It is likely that, when the infrastructure is in place, communication service providers will be in the driver’s seat to benefit from integrating 5G with SD-WAN.

With the SD-WAN market maturing, appliance vendors and communication service providers must continue to develop solutions that differentiates themselves from the competition, while continuing to keep in touch with demand from enterprise verticals. “The enterprise connectivity ecosystem is driven by demand. Enterprise verticals generally want a fully integrated, managed, or co-managed, OPEX-led networking solution that provides cross enterprise visibility and cloud accessibility; given the highly saturated nature of the SD-WAN market, suppliers must develop solutions that closely reflect the needs of enterprise verticals. While it is vital to keep an eye on the future and the migration to SASE, SD-WAN continues to offer significant opportunities to enterprises, communication service providers, and appliance vendors,” Hayden concludes.

These findings are from ABI Research’s The Future of SD-WAN in Enterprise application analysis report. This report is part of the company’s Distributed & Edge Computing research service, which includes research, data, and ABI Insights. Based on extensive primary interviews, Application Analysis reports present in-depth analysis on key market trends and factors for a specific application, which could focus on an individual market or geography.