SD-WAN: The Network Evolves to Support Digital Transformation and Cloud

The first in a 3-part series from IDC, sponsored by Windstream, on the impact of SD-WAN

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Brad Casemore, IDC Research Director, Datacenter Networks SD-WAN has emerged as an important solution for businesses which are increasingly dependent on the cloud, and are striving to digitally transform their operations. IDC has found that digital transformation is an imperative for enterprises and other organizations worldwide. Indeed, in a world defined by digital transformation, competition is increasingly intense. Organizations that are first to leverage technologies that improve customer experiences will prosper, and those that are slower to adapt risk market-share losses and even business irrelevance.

In this context, network transformation must occur in support of digital transformation. Indeed, network resources that support digital initiatives are coming under intense scrutiny. Increasingly, that focus is on the wide area network (WAN), which provides essential connectivity and valuable network services for branch offices and remote sites – precisely where organizations transact business, and often where they engage directly with customers, on a daily basis (further insight on the role of the WAN in digital transformation can be found in our recent white paper on SD-WAN, more on that below, as well).

Not surprisingly, cloud is at the forefront of most companies' digital-transformation strategies, and the WAN is hugely important to the delivery of cloud services. As public and private cloud continue to grow, and as they become increasingly important to the business outcomes of enterprises, WAN performance becomes absolutely critical to application delivery and business success.

Although WAN optimization and other traditional WAN enhancements have been used to address application-performance constraints, new capabilities have emerged to meet the requirements of cloud computing. Consequently, we have witnessed the rise of the hybrid WAN and the software-defined WAN (SD-WAN). These leverage the principle of software-defined networking (SDN) and adapt them to the needs of organizations seeking to optimize application delivery across the distributed enterprise and the cloud.

SD-WAN is particularly relevant for enterprises that have adopted or are adopting hybrid cloud, and especially for those that are leveraging SaaS applications. In this context, there is a strong motivation to reassess WAN architectures. What made sense on the WAN when client-server applications were housed exclusively in an enterprise datacenter does not make sense when applications reside in public, private, and hybrid-cloud environments. Hybrid cloud demands an application-based approach to service delivery at branch offices and remote sites. This approach must support broadband Internet and 4G/LTE technologies as well as traditional VPNs and MPLS, and it possesses the intelligence to steer traffic across the best-performing path, thereby ensuring optimal application performance.

There's no question that cloud initiatives are driving a thorough reconsideration of WAN architectures and strategies. In a recent SD-WAN survey, for example, IDC found that the importance of SaaS to the enterprise WAN is expected to increase sharply in the next two years.

SaaS for WAN Planning

Source: IDC's Software-defined WAN (SD-WAN) Survey, April 2016. N = 605

Nearly 33% of enterprise respondents indicated that SaaS will be very important to their organizations' WAN technology choices and planning in the next 12–24 months (see chart), with SaaS rated as very important or somewhat important to the WAN technology choices of nearly 64% of respondents.

As mentioned above, IDC recently authored a white paper, sponsored by Windstream that examines how digital transformation and cloud computing have necessitated a significant reassessment of the WAN, and it explores how and why SD-WAN has arisen in a response to new requirements. The paper also examines Windstream's approach to SD-WAN which leverages technology from SD-WAN vendor VeloCloud and combines it with Windstream's extensive portfolio of customized professional services and long-established network capabilities.