Enterprise SD-WAN market could reach $8 billion in 2021

• Infrastructure and services revenues will see a CAGR of 69.6 per cent
• Enterprise digital transformation the main driver
• Public cloud-based SaaS also driving SD-WAN
• Broader acceptance of SDN technologies in the enterprise

Software-defined wide area network (SD-WAN) solutions have made rapid progress in just a few years, and are being adopted by enterprises as they seek new approaches to their evolving networking requirements. A new report from research company IDC estimates that worldwide SD-WAN infrastructure and services revenues will see a compound annual growth rate (CAGR) of 69.6 per cent and reach $8.05 billion in 2021.

According to IDC, the most significant driver of SD-WAN growth over the next five years will be digital transformation, in which enterprises deploy so-called “third platform” technologies – including cloud, big data and analytics, mobility and social business – to unlock new sources of innovation and creativity that enhance customer experiences and improve financial performance.

Another factor driving the growth of SD-WAN is the continued rise of public cloud-based software-as-a-service (SaaS) applications. IDC says that the increase in SaaS adoption for business applications throughout the enterprise disrupts the prominence of current MPLS-based WAN connectivity to the branch. SD-WAN is being increasingly leveraged by enterprises to provide dynamic connectivity and optimisation in a policy-driven, centrally manageable distributed network architecture.

A third factor is the broader acceptance and adoption of software-defined networking (SDN) throughout the enterprise. As virtualisation, cloud management and SDN continue to gain traction throughout enterprise networks, IDC says SD-WAN will benefit from this change and receive increasing consideration.

"SD-WAN is not a solution in search of a problem," said Rohit Mehra, VP of Network Infrastructure at IDC. "Traditional WANs were not architected for the cloud and are also poorly suited to the security requirements associated with distributed and cloud-based applications. And, while hybrid WAN emerged to meet some of these next-generation connectivity challenges, SD-WAN builds on hybrid WAN to offer a more complete solution."

As IDC explains it, SD-WAN leverages hybrid WAN but includes a centralised, application-based policy controller; analytics for application and network visibility; a secure software overlay that abstracts the underlying networks; and an optional SD-WAN forwarder (routing capability). Together these technologies provide intelligent path selection across WAN links, based on the application policies defined on the controller.