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SD-WAN: Threat or opportunity for telcos?

Doug Farndale, Vice President, APAC, Silver Peak | Nov. 11, 2015
When leveraging the right, complete solution, a software-defined WAN solution can provide automated licensing to help get new and innovative services to market quickly, which in turn means a faster time to revenue.

This vendor-written piece has been edited by Executive Networks Media to eliminate product promotion, but readers should note it will likely favour the submitter's approach.

Doug Farndale, Silver Peak
Photo: Doug Farndale

Disrupt or be disrupted. That was one of the key messages that Cisco's outgoing CEO, John Chambers, gave in his keynote at the company's user event, Cisco Live, earlier this year. The message is short but clear: the business climate is changing and you can either change with it, or become irrelevant.

That has certainly been the case in networking and telecommunications, where the explosion of cloud services and mounting frustration surrounding the high cost and inflexibility of multiprotocol label switching (MPLS) networks is forcing enterprises to rethink their enterprise wide area network (WAN) strategy.

Companies are now looking to the Internet to augment or replace their current WAN connections, which has opened the door for faster WAN provisioning and the ability to use multiple WAN paths at the same time. This WAN transformation is being referred to as the software-defined WAN, or SD-WAN.

Why is SD-WAN so disruptive? As an overlay technology, it enables customers to rapidly and non-disruptively augment or replace their MPLS networks with any form of Internet connectivity. It provides visibility into all applications, and the capability to centrally-control all WAN traffic. It ensures end-users are satisfied with consistent and enhanced application performance. Finally, it can dramatically lower connectivity, equipment and network administration costs by up to 90%.

But is SD-WAN a friend, or a foe, of the telco?

At first glance, it could easily be viewed as a competitive threat. After all, the objective of most implementations of an SD-WAN by enterprises is to offset the cost, rigidity and lack of control typically associated with MPLS. And, for most service providers, MPLS is a huge source of revenue.

However, if you look a bit closer, one could argue that SD-WAN could very well become the telco's best friend. First, you start with reality. The rise of SD-WAN is already happening among global enterprises that want to leverage broadband Internet to augment or replace their existing MPLS connectivity.

Companies like memory products leader Kingston Technology and global manufacturer Interroll have already started to "broadband their WAN" with SD-WAN technology, and are now benefitting from a lower cost and more agile network for their operations in Asia and across the globe.

With most telcos continually looking to differentiate their business and provide value to their customer base, SD-WAN can be their new, differentiated solution, delivering SD-WAN as a managed solution or as part of a network functions virtualisation (NFV) offering.

 

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