As operators like AT&T (NYSE: T) and Verizon (NYSE: VZ) deploy more software-defined networking (SDN) and network functions virtualization (NFV), research firm International Data Corporation (IDC) is taking note of the SDN shift from the datacenter networks to the wide area networks.
"The emergence of SD-WAN is a relatively recent market development, preceded by the existence of hybrid WAN architectures," IDC said in a press release. "SD-WANs leverage these hybrid WANs, but incorporate a centralized, application-based policy controller, analytics for application and network visibility, a software overlay that abstracts underlying networks, and an optional SD-WAN forwarder that together provides intelligent path selection across WAN links."
IDC believes that SD-WAN's value proposition -- predicated on the growth of cloud computing, the need for simplified virtual private network (VPN) capabilities and the business imperative of reducing MPLS costs – will be compelling for a growing number of enterprise customers that want to provide cost-effective cloud-era networking to branch offices and remote sites. A recent U.S .survey supports that view, showing nearly half of enterprises plan to consider migration to SD-WAN over the next two years.
The research firm is forecasting software-defined wide area network (SD-WAN) revenues will exceed $6 billion in 2020 with a compound annual growth rate of more than 90 percent over the 2015-2020 forecast period.
"As public and private cloud use continues to grow, WAN performance becomes critical to latency-sensitive and mission-critical workloads and inter-datacenter business continuity," said Rohit Mehra, vice president, Network Infrastructure at IDC. "Accordingly, as enterprises plan and implement comprehensive cloud strategies, WAN architectures need to be considered alongside, and in conjunction with, datacenter infrastructure. Moreover, as enterprises move business processes to the cloud, there is a greater need to fully integrate cloud-sourced services into WAN environments to ensure workload/application performance, availability, and security."
SDN/NFV champion AT&T has a goal to virtualize and control more than 75 percent of its network using a software-driven architecture by 2020. Using what AT&T calls the User-Defined Network Cloud, the vision is to create products and services faster than before, with more flexibility and services on demand and scaled to meet specific needs.
In a Q&A session at the Open Networking Summit in Santa Clara, Calif., earlier this month, John Donovan, AT&T chief strategy officer and group president, Technology and Operations, said the culture change that AT&T is making is as important as the investments it's making in technology, and everything the company now does is benchmarked against software companies – not other telecom providers. "We compare ourselves and what we want to be aspirationally to companies that were born in software, who only do software, and that's the core of what they do," he said.
- see this press release
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