Software-Defined Wide Area Network (SD-WAN) Market Report

The major driving factor for the software-defined wide area network (SD-WAN) market is a single dashboard managing connectivity across the WAN. SD-WAN dramatically improves the experience of users by consolidating networking under a single intelligent dashboard that oversees connectivity across wide area networks (WANs). Central management tools yield monitoring and debugging into a very manageable point, from which IT teams can quickly locate and rectify problems. This reduces downtime and improves overall network behavior. The dashboard affords real-time visibility into traffic patterns, application performance, and network health. This enables streamlining operations, thus making proactive adjustments toward optimal resource utilization. In addition, the management of heterogeneous network environments involving cloud services, branch offices, and remote users from just one interface assumes efficiency in achieving greater agility and pace in responding to changes in business needs. With organizations focusing more on seamless connectivity and user experience, the demand for SD-WAN with full-dashboard capabilities will more than likely grow exponentially.

Network security is probably one of the biggest challenges for the SD-WAN industry because cyber threats have taken up their game in complexity and sophistication. As organizations try to leverage SD-WAN to optimize performance and connectivity across disparate locations, they also have to deal with vulnerabilities from centralized management as well as multi-tenant environments. SD-WAN is intrinsically dynamic; it changes and adapts the network conditions in real time, which might accidentally breach the security gaps if not controlled well. Its integration with heterogeneous network services, including cloud applications and IoT devices, increases the attack surface; therefore, the SD-WAN provider must implement strong security controls, such as encryption, secure access control, and continuous monitoring of risks. The industry at large is still challenged by the need to balance flexibility and scalability with extreme security requirements given how organizations desire to preserve sensitive information while exploiting all that SD-WAN technology has to offer.

The main challenge in the SD-WAN industry is configuration conflicts with the existence of numerous devices and a dynamic network environment. The implementation of SD-WAN solutions to optimize connectivity may disrupt performance and security based on inconsistencies in configuration. Overlapping policies could misroute traffic and create bottlenecks and vulnerabilities. Since errors can easily creep into the management of manual configuration, the process of troubleshooting is lengthened. It requires advanced orchestration and automation techniques to ensure smooth integration and policy enforcement of operations, but development cannot match the emerging networks that affect the organization's continued optimal performance and security.

In August 2023, Adaptive Networks, a cloud-native SD-WAN-as-a-Service vendor, debuted Cloud Protect, its new URL filtering service, that improved network security for SD-WAN customers. Cloud Protect was available to all Adaptive SD-WAN customers running the latest version of the platform (v8). Cloud Protect allowed businesses to deploy a cloud solution that added a layer of cybersecurity protection without increasing network complexity. As a URL and DNS, Cloud Protect was a cloud-based filtering tool that enabled organizations to automatically protect their network users from accessing risky websites with illegal or inappropriate content by using a real-time library of tens of millions of categorized destinations.

Additionally, more restrictive network security policy templates were available to block access to unproductive websites such as gambling, adult material, or social media.
In June 2022, Telefónica Tech and Cisco formed a collaboration and a global managed service, which included SD-WAN, security, and secure access service edge (SASE) architectures. This new service was comprised of an integrated connectivity and security solution to connect enterprises across data centers, branch offices, and remote employee locations. The connectivity part of the service leveraged Cisco's portfolio of SD-WAN solutions, along with the Cisco Meraki cloud-managed platform and wireless solutions, as well as a cloud security module with Cisco Umbrella was included in the services. This alliance reinforced the work done with Cisco for years and allowed Telefónica Tech's capabilities as a managed services provider within the Cisco ecosystem to evolve.

The demand for software-defined wide-area networks is expected to rise in North America due to the rising number of broadband connections. Internet broadband connection is increasing in North America due to rising demand for high-speed internet driven by remote work, online education, and streaming services. Furthermore, as per the data of the White House, President Biden had promised to connect every household by the year 2030, investing a total of US$ 80 billion in federal funding for the expansion of affordable, reliable, high-speed internet across the country. Also, the ACP program is considered the most successful and largest affordability program in America, where a total of 23 million households have been registered, which is one in every six households.

Also, Asia Pacific can be considered a lucrative market due to the rising demand for cloud computing and cloud services. India is rapidly evolving into a digitally empowered society and knowledge-based economy. As per the data of the Indian Brand Equity Foundation, cloud technology will contribute 8% to India's GDP by 2026, potentially boosting GDP by US$ 310-380 billion. Furthermore, it is estimated that cloud investment will increase by 25–30% annually, reaching US$ 18.5 billion by 2022. Similarly, the Japan cloud market is expected to open new opportunities for SD-WAN due to its cloud market. Japan's cloud market is rising due to increasing digital transformation efforts among businesses, driven by the need for remote work solutions and improved operational efficiency. Also, as per the data of the International Trade Administration U.S. Department of Commerce in 2021, the Japanese cloud market size was US$ 32.53 billion and saw a market growth of 24.3%. Thus, due to the rising cloud market, the demand for SD-WAN is expected to grow.