Enterprise networking is experiencing a significant transformation, similar to the telecom service provider sector. The data center and enterprise software‑defined networking (SDN) market increased by 82 percent in 2015 from the prior year -- reaching $1.4 billion, according to the latest worldwide market study by IHS.
New SDN use cases continue to emerge, with 2015 including the establishment of the SD-WAN market. Many new startups vendors, WAN optimization appliance vendors and some enterprise networking vendors have entered the market, now IHS has forecast SD-WAN revenue to reach $1.3 billion by 2020.
Growth for SDN-capable Ethernet switches and SDN controllers continues to grow, with early players, pure-play SDN startups and traditional switch vendors gaining traction as customer deployments escalate.
Enterprise SDN Market Development Trends
Regionally, North America, Europe, the Middle East and Africa (EMEA), Asia-Pacific and the Caribbean and Latin America (CALA) were all up in 2015 for data center and enterprise SDN hardware and software revenue.
"This year we look for new deployments of SDN and the scaling up of existing deployments," said Cliff Grossner, senior research director at IHS Technology. "We continue to see vendors add to their SDN-capable products and organize new open source projects, adjusting their businesses to be part of the SDN‑driven transformation."
With the data center and enterprise SDN market embracing open source software and open hardware designs, the number of deployed networking solutions based upon open solutions is expected to multiply, and open source software for networking will mature as the integration of individual components creates a complete ecosystem.
However, Grossner cautioned, "We cannot ignore the hardware. Innovation in networking software is really ramping up, with open source taking the network world, just as it did with general computing over the last 10 years."
Anticipated SDN Market Share Transitions
But it is important not to lose sight that bare metal switching can provide more than a fixed-function merchant silicon data plane. IHS believes that there's room for programmable silicon in bare metal switches that is software customizable to meet evolving application requirements, removing the need to replace silicon to innovate.
According to the IHS assessment, the top SDN market share positions are anticipated to change hands frequently. For 2015, the leaders in the individual data center and enterprise LAN SDN categories were White Box for bare metal switches, Dell for branded bare metal switches, VMware for SDN controllers and Hewlett Packard Enterprise for SDN-capable (in-use and not-in-use) branded Ethernet switch ports.