SD-WAN: What It Is & Why Organizations Are Embracing It

Cover Story

SD-WAN: What It Is & Why Organizations Are Embracing It

By Paula Bernier, Executive Editor, TMC  |  January 18, 2017

2016 was a very good year for SD-WAN, and this year is expected to be even better. That’s because 2017 is the year in which SD-WAN is likely to reach the tipping point. At least according to some sources.

“2017 is going to be a really big year for this space,” comments Nick Lippis, co-chairman and co-founder of the Open Networking User Group, which helped define SD-WAN and is playing a key role in moving this network architecture forward.

International Data Corp. forecasts that SD-WAN revenue will start to ramp strongly in 2016 and 2017 across a range of vertical markets. Gartner (News - Alert) predicts that up to 30 percent of users will be managing their WAN through software within three years. And IDC estimates that worldwide SD-WAN revenues will exceed $6 billion in 2020, with a compound annual growth rate of more than 90 percent between 2015 and 2020.

SD-WAN Definition & History

Definitions of SD-WAN vary. But Lippis of ONUG says it’s an overlay of the wide area network that separates the physical infrastructure from how packets are routed. That enables SD-WAN to provide users with total control of connectivity between their locations, he adds, so they can match that connectivity to their specific applications at any time.

Lippis credits Jimmy Kyriannis, who is in IT at NYU, with introducing the concept of SD-WAN. At an ONUG board meeting in late 2012 or early 2013, he says, Kyriannis talked about his challenges with branch offices, and many of the others at the meeting expressed that they had similar concerns. So the group came up with nine use cases at the meeting, the board selected the most important ones, and the group presented its findings to ONUG. What we now refer to as SD-WAN received the most votes in the ONUG community at that meeting.


This architecture has grown in popularity for a variety of reasons. It can enable organizations to more affordably and efficiently bring connectivity to their branch offices, and to better manage that connectivity.

It’s more affordable because businesses as a result can opt to drop their pricey MPLS connections. But even if businesses elect to keep their MPLS connections, SD-WAN enables those organizations to make better use of what they have, because it lets them employ their secondary and other links all the time rather than having them sit idle until the primary link goes down.

“A lot of times SD-WAN companies try to make the case that SD-WAN is about reducing network costs,” says Matt Gwyther, technical marketing manager of SD-WAN solution provider FatPipe. “In the real world, that’s not necessarily the case. It’s about making more efficient use of their networking spend.”

For example, Gwyther says, if a company is moving an application to AWS or Azure or Salesforce, the traditional MPLS topology is not as efficient as locally gatewaying internet traffic. So the benefit of SD-WAN, he explains, is not necessarily that it will lead to a company ripping out MPLS, but rather that it can combine MPLS and a dedicated internet circuit side by side for the most efficient use of those connections.

SD-WAN also is lauded by vendors for its ability to free businesses from being locked in to a single communications services provider. Instead, organizations with SD-WAN can leverage a variety of carriers and service types – including cable modem and DSL broadband services (made carrier-class with the addition of SD-WAN), Ethernet, LTE, microwave, and MPLS.

As noted earlier, SD-WAN is also appealing because it allows for more network automation, meaning better response times, more centralized management, and the need for fewer IT resources.

But SD-WAN is not just about the network. This technology also can address application performance by leveraging pre-programmed policies to ensure that traffic gets the treatment it requires for the best user experience.

Neil Abogado, director of product marketing at Talari, says SD-WAN

also is evolving into a solution that can allow for the replacement of routers at branch locations and can provide firewall, VPN, and other functionality. Talari’s products are among those that already do all of that today.

Why Now?

The adoption of cloud services is widely noted as a driving force that has led SD-WAN to take hold at this particular point in time.

When more applications move to the cloud and become available via the software-as-a-service model, notes John Vincenzo, senior vice president and CMO at SD-WAN solutions provider Silver Peak (News - Alert), the internet comes into play. And when customers are connecting to applications on the internet, it makes sense to use the internet to connect to those applications, he adds.

Ensuring WAN performance also becomes more important in a cloud-centric world, notes Rohit Mehra, vice president of network infrastructure at research and consulting company IDC (News - Alert).

"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," says Mehra. "Accordingly, as enterprises plan and implement comprehensive cloud strategies, WAN architectures need to be considered alongside, and in conjunction with, data center 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."

Enterprises need more bandwidth capacity to support all their applications, and no one wants to add more complexity and management to make that happen, notes Ricardo Belmar, senior director for enterprise product marketing at SD-WAN solutions provider InfoVista. So the desire for more bandwidth with ease of use is one key driver of SD-WAN adoption, he says.

Another, he adds, is that enterprises are expecting ways to get better performance. Say, for example, a business is running Skype (News - Alert) for Business and has branch locations and a couple different networks – an MPLS network and also some direct internet connections, and it wants to use all those network resources. The IT staff can write rules specifying what performance levels they want to achieve for Skype for Business and their other applications, and SD-WAN can make that happen, he says. That way if Network A already has a large number of Skype for Business users on it, the system might decide to direct new calls to Network B, for example, he says.

Kumar Ramachandran (News - Alert), founder and CEO of SD-WAN solution provider CloudGenix, says there are three main drivers of SD-WAN adoption. The first is customers migrating to the cloud with applications such as Microsoft 365, says Ramachandran, who notes that the cloud version of this application requires four times more bandwidth per Microsoft guidelines. SD-WAN, he adds, allows for the migration to the cloud without compromising performance or security.

The second is the hybrid WAN, he says, noting that customers want to seamlessly combine multiple kinds of links as a homogenous whole, and maintain control so they are not locked into a particular service provider for access services. The third, according to Ramachandran, is the desire to use virtual customer premises equipment.

In addition to some of the drivers noted above, says Mike Wood, vice president of marketing at VeloCloud, SD-WAN is being propelled forward by the fact that a lot of IT departments don’t have adequate people and tools to monitor, troubleshoot, and visit all of their sites, so SD-WAN solutions can allow them to manage all their locations centrally and in the process reduce the resources required for that management. 

Edited by Stefania Viscusi


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