Five years ago, the term SD-WAN barely existed (if at all). Five years from now, SD-WAN will be an $8 billion a year business, according to IDC.
Software Defined (SD) WAN makes use of public internet links to replace more costly MPLS, private links to deliver WAN connectivity for an organization. IDC is now forecasting that in 2021 SD-WAN will bring in $8.05 billion in revenue, giving the nascent networking segment a Compound Annual Growth Rate (CAGR) of 69.6 percent.
A year ago, IDC had predicted that SD-WAN revenues would grow to $6 billion by 2020 and that 70 percent of enterprises expected to use SD-WAN by the middle of 2019.
"SD-WAN is not a solution in search of a problem," Rohit Mehra, vice president, Network Infrastructure at IDC, said in a statement. "Traditional WANs were not architected for the cloud and are also poorly suited to the security requirements associated with distributed and cloud-based applications."
"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," he added.
Networking giant Cisco is also seeing the potential for SD-WAN. In May Cisco announced the $610 million acquisition of privately-held SD-WAN vendor Viptela.
"The Viptela fabric especially, as it relates to SD-WAN and cloud networking, fits in as an important piece of Cisco’s Enterprise Networking strategy which is driving an industry-wide transition to a software centric architecture and business model," Viptela CEO Praveen Akkiraju stated at the time of the acquisition.
Sean Michael Kerner is a senior editor at EnterpriseNetworkingPlanet and InternetNews.com. Follow him on Twitter @TechJournalist.