According to a recent International Data Corporation (IDC)
forecast, the worldwide software-defined networking (SDN) market —
comprising physical network infrastructure, virtualization/control
software, SDN applications (including network and security services),
and professional services — will have a compound annual growth rate
(CAGR) of 53.9% from 2014 to 2020 and will be worth nearly $12.5 billion
in 2020.
Software-defined networking continues to gain market traction as an
innovative architectural model capable of enabling automated
provisioning, network virtualization, and network programmability for
datacenters at cloud-providers and enterprise networks. Although SDN
initially found favor in hyperscale datacenters and at large-scale cloud
service providers, it is winning adoption in a growing number of
enterprise datacenters across a broad range of vertical markets. Indeed,
SDN delivers the agility, flexibility, and programmability that align
closely with IDC's 3rd Platform for IT, especially for public and
private cloud rollouts.
While the physical network, encompassing datacenter switches, will still
account for the largest single segment of the SDN market in 2020, the
fastest growth will be found in the two software categories – the
virtualization/control layer and SDN applications – which together will
be worth approximately $5.9 billion. IDC expects the
virtualization/control layer software market to reach $2.4 billion in
2020, with a CAGR of nearly 64% during the forecast period. SDN
applications – including Layer 4-7 network and security services and
analytics – are forecast to achieve a CAGR of 66% through 2020, when
they will account for revenue of more than $3.5 billion.
"Cloud computing and the 3rd Platform have driven the need for SDN,
which will represent a market worth more than $12.5 billion in 2020. Not
surprisingly, the value of SDN will accrue increasingly to
network-virtualization software and to SDN applications, including
virtualized network and security services. Large enterprises are now
realizing the value of SDN in the datacenter, but ultimately, they will
also recognize its applicability across the WAN to branch offices and to
the campus network," said Rohit
Mehra, Vice President, Network Infrastructure at IDC.
“While networking hardware will continue to hold a prominent place in
network infrastructure, SDN is indicative of a long-term value migration
from hardware to software in the networking industry. For vendors, this
will portend a shift to software- and service-based business models, and
for enterprise customers, it will mean a move toward a more
collaborative approach to IT and a more business-oriented understanding
of how the network enables application delivery," said Brad
Casemore, Director of Research for Datacenter
Networking at IDC.
The IDC study, SDN
Market to Gain Enterprise Headway, Driven by 3rd Platform and Cloud
(IDC #US40628315), takes a closer look at the rapidly evolving market
and its associated ecosystem, while analyzing opportunities and
challenges for datacenter and enterprise network managers.