ISG Provider Lens™ Network - Software Defined Solutions and Services Partners - Global Summary Report 2020
GLOBAL MARKET TRENDS
ISG sees several common trends across regions and industries:
Strategic Focus as Enterprises Revisit ICT Roadmaps
Over the past year a large percentage of enterprises restarted their roadmaps for digital transformation and ICT with plans for how software defined (SD) works with security applications of today and tomorrow. This strategic focus shifts the discussions from network technology to solving business problems. Enterprises want to add applications and network resources to meet business and user goals more efficiently and securely without creating silos or depending on vendors. Plus, they want central control. The discussion around software defined networking (SDN) increasingly focuses on improving the integration, automation, orchestration and management of network resources and processes.
SDN Lowers Risks of Enterprise Movement to Global Cloud Deployments
SDN can help enterprises with cloud migration by reducing complexity and enabling a reduced risk migration to single or multi-cloud environments. Enterprises are looking to move IT and network functions into the cloud for cost savings and other efficiencies. This includes hybrid and multi-cloud setups with central controllers and visibility of the entire network infrastructure.
SD WANs Driven by Cost Savings to Cloud-based ICT
The most cost saving is for those organizations moving from, or moving a lot of the current network from, MPLS to IP-based, SD-based, or data center-based hybrid environments including MPLS based on policy usage. Transformations are taking place mainly along WAN optimization for hybrid cloud environments, moving the edge to the cloud with cost efficiency realized at the transport layer.
Technology Provider Landscape Explodes
From a provider standpoint, there has been a shift from telcos and large providers being the providers of choice to expansive groups including system integrators and service providers using network technologies, such as Cisco and Meraki. These providers offer enterprises a one-stop, end-to-end experience for technology plus integration and change management. The technology continues to improve, and these providers’ developers partner with many others to get into enterprises faster. There is no longer a discreet network activity – it is a strategic digital transformation play.
Interest Varies by Industry
Software-defined networking offers benefits to applications in some verticals more than others. Retail is a large adopter of small-to-medium SD WAN solutions with rapid agile application rollouts. Banking online and ATM services benefit from the distributed services. For those industries supporting multiple branches or multi offices, SD WAN with SD LAN allows rapid changes to branches, so is a driver of high value. In manufacturing, machines connect into the network and use SD capabilities for improved monitoring and productivity.
Shift from Contract-Based to Consumption-Based Business Model
Enterprises are looking for the ability to consume the network as a service instead of getting into a traditional carrier-based model or a contract model where the network operates in a silo, with a closed CPE environment and a transport tightly integrated into the delivery of the solution. The enterprises are looking at consultative approaches which can customize and analyze the network from an application as well as a security perspective and thus, an end-to-end automation and orchestration of the customer’s network is preferred.
Small and Medium Size Businesses (SMBs) Still Looking First to Cost Savings and Agility
The SMB market still focuses its software defined networking thinking on lower costs, flexibility, and speed to market by taking advantage of the abstraction of the hardware from the operating layers, thus reducing reliance on MPLS term contracts, improving quality on IP/Internet contracts for most communications (or hybrid MPLS/IP), and flexible capacity (important during COVID-19). Large enterprises want savings too but are looking to be agile as they serve multiple business units and distributed branches with a need to scale both inward and outward-facing services offerings. In the past year, there is a notable shift to decisions based on agility more so than cost.
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