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The software-defined wide area network (SD-WAN) market size is estimated to grow at a CAGR of 29.02% between 2023 and 2028. The market size is forecast to increase by USD 13.66 billion. The growth of the market depends on several factors, including rising demand for cloud solutions, a surge in digital transformation, and the growing popularity of SD-WAN as a service. A software-defined wide area network (SD-WAN) enables enterprises to connect with their branch offices and data centers dynamically. It directs the traffic securely across the WAN through a centralized control function. It also allows enterprises to use any combination of transport services, such as long-term evolution (LTE), broadband, and multiprotocol label switching (MPLS), to deliver applications to their users. Some of the primary benefits of SD-WAN include cost optimization, simplified management, enhanced business agility, and improved user experience.
The report includes a comprehensive outlook on the Software-defined Wide Area Network (SD-WAN) Market, offering forecasts for the industry segmented by Product, which comprises solutions and services. Additionally, it categorizes End-user into service providers and enterprise customers, and covers Geography regions, including North America, APAC, Europe, South America, and Middle East and Africa. The report provides market size, historical data spanning from 2018 to 2022, and future projections, all presented in terms of value in USD billion for each of the mentioned segments.
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The rising demand for cloud solutions is notably driving market growth. Enterprises and service providers are the main contributors to the rise in demand, that are looking to shift their on-premise data center workloads to the cloud to improve their scalability, efficiency, and agility and reduce CAPEX and OPEX.
However, the inadequate WAN capacity of such enterprises does not support such transition and results in network reliability issues, latency issues, and network congestion. the demand for cloud-based SD-WAN is increasing as it overcomes such challenges. Enterprises across various industry sectors, such as banking, financial services, and insurance (BFSI), content and digital media, retail, and manufacturing, are implementing SD-WAN solutions to overcome network-related challenges. Therefore, such factors will boost the market growth during the forecast period.
Business strategies undertaken by companies is the primary trend shaping market growth. Collaborations between service providers and market players will contribute toward the growth of SD-WAN solutions among SMEs. Furthermore, companies' willingness to expand their operations globally will increase the partnerships with local service providers. Furthermore, market players will continue to invest in enhancing security, routing, and network management features in their SD-WAN solutions to gain a competitive edge in the global software-defined wide area network (SD-WAN) market.
For instance, in December 2020, Fortinet, a global leader in integrated and automated cybersecurity solutions, announced the FortiGate Rugged 60F and FortiGate Rugged 60F with built-in LTE next-generation firewalls, the industry's first secure SD-WAN appliances that are certified to perform in operational technology (OT) environments. Therefore, the business strategies undertaken by market vendors, such as acquisitions and product enhancement, are expected to fuel the growth of the software-defined wide area network (SD-WAN) market during the forecast period.
The lack of workers with technical skills is a challenge that affects market growth. Most IT personnel have command over traditional and fundamental technologies in network infrastructures, such as cyber-threat detection, assessment, and prevention. However, as most data centers are shifting toward automation processes, the entire infrastructure, including computing, storage, security, and networking infrastructure, is integrated and controlled by a single interface. To overcome this challenge, most market players are offering courses to enable young professionals to understand new technological advancements in the global software-defined wide area network (SD-WAN) market.
Furthermore, although the technical skill gap will remain a major constraint for enterprises while adopting advanced technologies such as SD-WAN solutions, it is expected to be short-term as most vendors have started offering educational resources for young professionals to understand their SD-WAN solutions. Hence, the lack of workers with technical skills is expected to have a negative impact on the market during the forecast period.
The market share growth by the solutions segment will be significant during the forecast period. In order to securely link users to applications, businesses can employ any combination of transport services, such as MPLS, LTE, and broadband internet services, through the usage of a software-defined wide area network (SD-WAN). A business model known as "managed network service" or "SD-WAN service" involves completely outsourcing networking applications and services to a managed service provider (MSP) or communications service provider (CSP).
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The solutions segment showed a gradual increase in the market share of USD 1.36 billion in 2018. Because SD-WAN is a sophisticated technology, it requires regular maintenance by IT professionals. If this is not done, it may lead to higher expenses in maintaining SD-WAN infrastructure. Providers of SD-WAN frequently need extra services for setting up, integrating, and maintaining the software. Thus, the services segment is expected to fuel the growth of the software-defined wide area network market during the forecast period.
Customers in the global software-defined wide area network (SD-WAN) market are large-scale enterprises and service providers. While most large-scale enterprises purchase SD-WAN solutions directly from market players and implement them on their own, most SMEs approach service providers to assist them in implementing SD-WAN solutions. Service providers partner with SD-WAN market players and offer managed SD-WAN services to such customers. Furthermore, enterprises are increasingly opting for managed services to overcome high in-house cost-related factors. Also, digital transformation initiatives undertaken by enterprises, the adoption of cloud solutions, and the rise of new technologies such as AI will fuel the demand for SD-WAN solutions. Thus, the service providers segment of the software-defined Wide area network market is expected to grow significantly during the forecast period.
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North America is estimated to contribute 37% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The US and Canada dominate data center investments in North America due to the rising demand for 5 G-enabled IoT solutions in these countries, strongly supported by high connectivity and bandwidth, cool ambient temperature, low electricity tariffs, and a tax-friendly environment.
Moreover, consumer and enterprise data traffic propel the demand for data centers in the region, owing to factors such as demand for IoT devices, rising investments in AI, implementation of autonomous technologies across enterprises, and growing investments in autonomous vehicles. IP traffic is also experiencing exponential growth, mainly driven by increasing mobile data consumption and high-bandwidth applications, leveraging the growth of the software-defined wide area network market in North America during the forecast period.
The Software-defined Wide Area Network (SD-WAN) Market report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Software-defined Wide Area Network (SD-WAN) Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The software-defined wide area network (SD-WAN) market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2018-2028
Software-defined Wide Area Network (SD-WAN) Market Scope |
|
Report Coverage |
Details |
Page number |
168 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 29.02% |
Market Growth 2024-2028 |
USD 13.66 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
27.25 |
Regional analysis |
North America, APAC, Europe, South America, and Middle East and Africa |
Performing market contribution |
North America at 37% |
Key countries |
US, China, Japan, UK, and Germany |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Arista Networks Inc., Aryaka Networks Inc., Bigleaf Networks Inc., Cato Networks Ltd., Cisco Systems Inc., Citrix Systems Inc., FatPipe Networks Inc., flexiWAN Ltd. , Forcepoint LLC, Fortinet Inc., Hewlett Packard Enterprise Co., Huawei Technologies Co. Ltd., Juniper Networks Inc., Lumen Technologies Inc., Nokia Corp., Oracle Corp., Palo Alto Networks Inc., Riverbed Technology Inc., Versa Networks Inc., and VMware Inc. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
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