What is happening with SD-WAN in 2023?
The state of the SD-WAN market has changed significantly since the 2010s, when it emerged as prominent driver of telco cloud activity, centred on North America. SD-WAN remains strong, with nearly a quarter of telco cloud deployments in 2022 having SD-WAN as the primary purpose, and has spread across the globe.
Every update of the Telco cloud deployment tracker includes a review of the confirmed or completed telco cloud deployments up to the end of the preceding quarter, and a deep dive into a significant trend revealed in the data. SD-WAN, SASE, and the evolution towards NaaS is in the spotlight in this update.
SD-WAN: A virtualisation success story
SD-WAN is an example of where a technology trend – Network Functions Virtualisation and Software Defined Networking (NFV and SDN) – fed directly into a successful commercial product. It comprises a bundle of Virtualised Network Functions (VNFs), such as routing, WAN optimisation and firewall, placed under centralised SDN control to deliver optimised, application-specific traffic management and prioritisation across the multi-domain, multi-technology enterprise network.
Initially developed and marketed as an overlay service by ISVs – a purely software-based service managed independently of the underlying network platforms – SD-WAN started to be widely delivered by telcos from 2017 as part of their managed enterprise networking portfolios. Deployments in this first wave of telco SD-WAN peaked in 2018, with 45 deployments focused on SD-WAN in that year.
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SASE is a response to the increasing cloudification of SD-WAN
Telcos have not driven innovation in the SD-WAN field. In terms of number of directly served enterprise customers and technology evolution, vendors dominate. Secure Access Service Edge (SASE) is one such vendor-led solution. It combines SD-WAN with several cloud-based security functions designed to protect against cyber attacks as network traffic crosses the borders between private and public networks and clouds.
Total number of SD-WAN and SASE deployments, 2016-2023
Source: STL Partners
SASE first emerged as a distinct offering in July 2019; but telcos lagged, and the first deployments by telcos were recorded only in 2021.
The increased focus on cloud-delivered security reflects the growing cloudification of WAN services themselves, with larger enterprises running application workloads and traffic across multiple clouds and bypassing the telco WAN altogether.
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