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The global SD-WAN market size stood at $1.4 billion in 2019, and it is expected to reach $43.0 billion by 2030, exhibiting a CAGR of 38.6% during the forecast period (2020–2030). The major factors supporting the growth of the industry include the increasing requirement for a simplified enterprise network architecture, need for cost-effective WAN management and automation, rising internet penetration, adoption of the bring-your-own-device (BYOD) policy at workplaces, surging utilization of internet of things (IoT) and big data, demand for network privacy, and rapid deployment of cloud-based solutions.
COVID-19 Impact Analysis
Owing to COVID-19, the market for software-defined wide area network solutions is witnessing a downfall in the growth rate. This is mainly due to the lockdown situation across the globe, which has resulted in a halt of business operations. As a result, businesses are focusing on reducing their expenditure. Additionally, the rising focus of enterprises on the work-from-home (WFH) model has resulted in a postponement of the planned implementation of SD-WAN solutions and lower demand for services, which has negatively impacted the growth of the SD-WAN market.
Services Category Is Witnessing Faster Growth in Offering Segment
The services category is expected to demonstrate the faster growth in the SD-WAN market during the forecast period. This can be ascribed to the increasing need of organizations for software-defined wide area network consulting, maintenance and support, and planning solutions, for managing the lifecycle of the technology, streamlining processes, and allocating resources, with respect to the use of related software and tools.
Cloud-Based SD-WAN Solutions Are Expected To Witness Faster Deployment
The cloud category is expected to register the faster growth in the SD-WAN market during the forecast period. This would be mainly due to the increasing adoption of cloud services because of their ability to support dynamic and highly automated operations in a cost-effective manner. Moreover, the increasing number of cloud security challenges, such as control and visibility of cloud data, misconfiguration, and user access to cloud data and applications, are also expected to result in a high demand for advanced SD-WAN solutions. These solutions support in strengthening the network infrastructure, by allowing for increased branch office agility, orchestration simplicity, and streamlined application performance.
Security Accounted for Largest Market Size
In 2019, the security category held the largest share in the market, on the basis of use case. This is mainly attributed to the strong focus on gathering and analyzing potential threats and real-time monitoring and tracking events, which enable organizations to detect cyberattacks beforehand, and for meeting compliance needs.
Healthcare Category To Showcase Fastest Growth in Market
The healthcare category is projected to witness the fastest growth in the SD-WAN market during the forecast period, on the basis of industry. This can be ascribed to the rising demand for enhanced patient experience, rising usage of remote medical care solutions, increasing need to fulfill the regulatory compliance, requirement for centralized management and monitoring that allows for the complete visibility of the WAN, increasing implementation of telehealth services, and surging utilization of cloud-based applications. Moreover, the rising healthcare spending is also supporting the adoption of SD-WAN solutions, globally. For instance, according to the 2020 Global Healthcare Sector Outlook report by Deloitte, the global healthcare spending is projected to rise at a CAGR of 5% during 2019–2023.
North America Is Dominating SD-WAN Industry
North America accounted for the largest size in the SD-WAN market during the historical period (2014–2019). The major factors supporting the industry growth are the presence of established market players in the region, growing focus on the launch of advanced SD-WAN solutions, vast adoption of next-generation technologies, increasing support from the government for the setup of the 5G network infrastructure, and strong requirement of enterprises to simplify their network operations.
Moreover, in March 2020, the Federal Communication Commission (FCC) in the U.S. announced the National Strategy to Secure 5G, which focuses on the development, implementation, and management of the 5G communication infrastructure. The key points under the strategy include facilitating the commercial use of 5G networks, recognizing fundamental security principles for the 5G infrastructure, managing the risks to economic and national security from the 5G infrastructure, and encouraging the global development and application of 5G. With the strong focus on 5G network, the region is expected to witness a high adoption of SD-WAN solutions, in order to make network connectivity stronger and secure all the networking operations.
Asia-Pacific (APAC) Region Is Projected To Witness Fastest Growth
Geographically, the fastest growth in the SD-WAN market is expected in APAC during the forecast period. This is mainly attributed to the rapid usage of enterprise networking solutions, rapid deployment of wireless devices, surging focus of small and medium enterprises (SMEs) on the implementation of cloud solutions, growing trend of bring-your-own-device (BYOD) at workplaces, increasing IT spending, and strong focus on network security.
As a result, players in the SD-WAN market are focused on establishing partnerships with cloud service providers, in order to help enterprises with a secure hybrid IT network and accelerate digital transformation. For instance, in June 2020, Aryaka Networks Inc. partnered with Alibaba Group Holding Limited, in order to provide service-level agreement (SLA)-driven connectivity with application acceleration, security, WAN optimization, software as a service (SaaS) access, last-mile services, and global orchestration.
WAN Optimization as a Service
Globally, IT organizations are in need of WAN optimization solutions to overcome the challenges of network performance and lower their WAN cost. Software-defined wide area network solution providers are continuously upgrading their physical and virtual WAN optimization product portfolio, to provide industries with accelerated application performance. Some major advantages provided by WAN optimization solutions include greater virtual flexibility, cloud-ready networking infrastructure, improved user experience, enhanced business productivity, secure optimization, and better SaaS application performance. Such trends are expected to contribute considerably to the global SD-WAN market growth.
Increasing Need for Network Privacy and Visibility
With an increasing amount of data being used worldwide, a wide range of mission-critical assets, such as applications, enterprise information, and databases, are becoming prone to unauthorized access. Traditional WAN solutions are not sufficient to protect the network from increasing threats and provide effective security control for cloud applications. SD-WAN solutions assist in monitoring and measuring network traffic and provide deep visibility to IT departments into WAN and allow them to quickly pinpoint a security attack. As a result, the SD-WAN market is expected to witness considerable growth in the coming years.
Growing Adoption of IoT and Big Data
The growing adoption of IoT and big data is another major driver resulting in the positive growth of the SD-WAN market. According to the Microsoft IoT Signals Report 2019, 85% of the total respondents (3,000) have adopted IoT and around 75% are working on IoT-based projects. However, there are several challenges related to IoT and big data, such as data privacy, high implementation costs, issues with the handling and management of the data, lack of knowledge, and security issues. SD-WAN supports in managing these challenges, via zero-touch provisioning (automatic configuration of devices with minimal manual intervention), centralized management and control, and minimization of the risks.
|Base Year (2019) Market Size||$1.4 Billion|
|Forecast Period (2020-2030) CAGR||38.6%|
|Report Coverage||Market Trends, Revenue Estimation and Forecast, Segmentation Analysis, Regional and Country Breakdown, Company Share Analysis, Companies’ Strategic Developments, Product Benchmarking, Company Profiling|
|Market Size by Segments||Offering, Deployment, Use Case, Industry, Region|
|Market Size of Geographies||U.S., Canada, U.K., Germany, France, Italy, Spain, China, Japan, India, Australia, South Korea, U.A.E., Saudi Arabia, Turkey, South Africa, Brazil, Mexico|
|Secondary Sources and References (Partial List)||Communications and Information Network Association of Japan (CIAJ), Computer & Communications Industry Association (CCIA), Computing Technology Industry Association (CompTIA), Interactive Multimedia and Collaborative Communications Association (IMCCA), Japan Internet Providers Association (JAIPA), Japan Network Security Association (JNSA), European Cyber Security Association (ECSA), Telecommunications Industry Association (TIA), Association for the Advancement of Artificial Intelligence (AAAI), Storage Networking Industry Association (SNIA)|
Rapid Migration toward Cloud-Based Applications
The swift migration of enterprises from traditional WAN infrastructure to cloud-based solutions has been encouraging them to adopt SD-WAN. Due to high maintenance costs and network complexity, enterprises are in need of secure, cost-effective, and easy WAN management. The growing usage of data-intensive applications, along with the emergence of the cloud technology, is making SD-WAN a promising solution for geographically distant offices, which need reliable connectivity and higher bandwidth. Moreover, according to the RightScale 2020 State of the Cloud Report by Flexera Software LLC, nearly 56% of SMEs individually spent up to $600,000 annually on cloud services. As a result, the focus of market players on cloud-supported SD-WAN solutions is projected to rise, thereby resulting in the positive growth of the SD-WAN market.
Mergers & Acquisitions Are Key Strategic Initiatives Adopted by Players in Industry
The SD-WAN market is fragmented in nature and continues to expand due to the advantages offered by SD-WAN solutions, such as an optimized bandwidth, improved application performance, and reduced cost. The players in the SD-WAN industry include Cisco Systems Inc., Citrix Systems Inc., Palo Alto Networks Inc., VMware Inc., Fortinet Inc., and Silver Peak Systems Inc., which are focused on the acquisition of SD-WAN service providers.
Some of the Key Players in the SD-WAN Market Report Include:
The SD-WAN market report offers comprehensive market segmentation analysis along with market estimation for the period 2014–2030.
Based on Offering
Based on Deployment
Based on Use Case
Based on Industry