The future of SD-WAN in a fast-changing networking market

‘Nothing is more powerful than an idea whose time has come’ wrote French author Victor Hugo in 1852. Hugo was talking about political revolution, but his words could just as easily be taken to apply to SD-WAN, the connectivity technology that, according to legend, helped shield countless organisations from the most harmful repercussions of lockdown and COVID-driven remote working. Might SD-WAN now be the solution for those looking for an effective and innovative way to move on from legacy network standards like MPLS and IP-based VPN networks? Could it also be the salvation of communications service providers looking for the next WAN wave to surf?

Erin Dunne, Director of Research Services with independent analyst firm Vertical System Group, doesn’t like the term ‘move on’. She made that much clear in a recent conversation with Business Innovation Leaders Forum Podcast Host Julian Patterson. Dunne told him she prefers the term ‘migration’: “Because ‘move on’ indicates you’re dumping something, which never happens in the world of networking,” she explains. “We have legacy services out there still generating billions of dollars worldwide [for telecoms companies] that have been around since the 80s, leased lines, Frame Relay, ATM, they’re still there.”

But nothing good lasts forever. Dunne estimates that MPLS and dedicated IP-VPN peaked circa 2017 after a very long run and are now pitched against competitive alternatives that offer a natural migration path, for example Ethernet services with a Layer 2 VPN option. She said it’s still too early to talk of the ‘death’ of the older standards, but expects a steady decline in their centrality over the next few years.

“There are certain enterprise locations that require the predictability and the resiliency of MPLS, even though it’s more expensive,” she notes. “But what we’re really looking for is a new networking paradigm for the cloud era. One of the main contenders here is already a global market worth around $5 billion. I’m talking about SD-WAN.”


Subheading: The five Cs of migration

Dunne’s specialist tranche of the market is carrier-managed SD-WAN services, something of a new kid on the block, smaller than the legacy dedicated IP VPN market opportunity but an area of growth nonetheless. So what is driving its appeal among enterprise users? She identifies what she calls the five Cs of migration to SD-WAN: cost, connectivity, cloud, control, cybersecurity: “Those four really make SD-WAN attractive for enterprises big and small,” she explains. “SD-WAN is clearly much better suited to the era of cloud networking than some predecessor technologies. Sure, you might have no other technology requirements, so you just nail up one big pipe right to the cloud. I guess then you don’t really need SD-WAN. However, that is not the way that enterprises operate. Most have inter site connectivity issues that need to be addressed.”

But does SD-WAN have a longer term future in a world that’s fast shifting to, say, highly distributed IoT and edge applications? Is it really built to last for tomorrow’s fluid network perimeters and shifting patterns of work?

“In some ways SD-WAN was a little early in its product cycle to address requirements like remote work,” notes Dunne. “It was a little heavy handed, slight overkill. Many vendors tried to morph their existing enterprise solutions to allow them to be installed in the home. But in most cases the homeworker is not a tech person, so if you send them a box and say ‘hook it up’ it’s not as simple as you think. A lot of software-based solutions just didn’t run on all end devices. There were security issues, there were implementation issues, there were processing issues. SD-WAN is not in all cases a wonderful solution for the work-from-home market. Could this be addressed? Absolutely. But it’s going to take a product cycle to streamline these solutions for the home market.”

The SD-WAN market may well, she feels, be going in a similar direction to other telco-provided connectivity services, away from a DIY ethic towards third party managed services.

“Yes, we’re seeing a trend toward the managed services aspect of SD-WAN,” believes Dunne. “It all depends on the particular migration path. Take the example of site-to-site VPN, which lots of enterprises have, where they have hundreds, maybe thousands of locations, to transition. For those types of organisations, keep it DIY. Others, with multinational challenges, or where enterprises are dealing with different regulatory requirements, you’re seeing those types of organisation choose a managed SD-WAN solution.”

The other danger of SD-WAN is that it can lead to the illusion that every challenge has a software-led solution, neglecting the truth that every network has a hardware dimension by necessity.

“Fibre to your location is incredibly important,” emphasises Dunne. “Because it allows many different options for your access connectivity. If you only have a broadband option, that does limit what you can implement on the services side. If you have access to your building, you can choose Ethernet, which is still a very healthy market. Once you’re talking about those high speeds, you can use that access conductivity to your SD-WAN. And enterprises love that. One of the staying powers we’re seeing for MPLS is if you have Ethernet access at 1Gb or above, let’s say to your MPLS network at a headquarters or a regional location, you won’t be getting rid of that. Where we’re seeing MPLS disappear is at lower speeds – copper-based Tier 1 access to MPLS. That market has hit the bottom and it’s never coming back. It went directly to broadband-based SD WAN. But if you have fibre and you can get Ethernet and you can utilise that access to either an SD-WAN network or your existing MPLS network, that changes your network connectivity. And it also changes whether you choose SD-WAN and as a wholesale swap out, or a hybrid model, which is what service providers are pushing.”


  • Erin Dunne is Director of Research Services for technology analyst Vertical Systems Group where she is responsible for looking at carrier-managed SD-WAN, fibre and cloud connectivity. She is also an expert on several other network related topics. Dunne also has a critical role with the Business Innovation Leaders Forum as one of its special advisors.


The podcast is available on Blubrry here.

And on iTunes here.


These links will be useful for anybody needing further SD-WAN information:



These vendors are among the leaders in the SD-WAN space:










Palo Alto



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Book of the Month*

The Serendipity Mindset: The Art and Science of Creating Good Luck

By Dr Christian Busch
Serendipity is an aptitude for making desirable discoveries by accident. To other people it looks like “good luck”, but it is more the ability to recognise and seize an opportunity, rather than have good fortune thrust upon one. Finding a wallet stuffed with money on the conference room floor is good luck, whereas holding it up and asking if anyone has lost their wallet might be the beginning of a valuable friendship – that would be serendipity.

Chance encounters, or strokes of fortune, feature in countless stories of business success. This book looks beneath the surface, reveals and teaches the mindset that can transform pure chance into opportunity. The author is director of the Global Economy Program at New York University’s Center for Global Affairs, and a lecturer at the London School of Economics.

Serendipity is an aptitude for making desirable discoveries by accident. To other people it looks like “good luck”, but it is more the ability to recognise and seize an opportunity, rather than have good fortune thrust upon one. Finding a wallet stuffed with money on the conference room floor is good luck, whereas holding it up and asking if anyone has lost their wallet might be the beginning of a valuable friendship – that would be serendipity.

The author says “This is a book about the interactions of coincidence, human ambition and imagination”. In the above example: finding the wallet is the coincidence; ambition is the desire to make something of the discovery; add imagination and you open up a whole menu of possibilities: from spending spree to earning a reputation for honesty – or even making a wealthy friend.

Business is typically forged on human ambition and imagination, but early success often feeds an appetite for control – and “control freaks” can be blind to the opportunities thrown up by the unexpected. They only see chance events as distractions. If plans go awry, they may blame the failure on “bad luck” rather than admit their own inflexible attitude.

The author himself admits to being “a German who is used to planning” and prone to feel anxious when something unexpected happens. That makes him an ideal teacher, because he has worked hard to discover and analyse the mindset that enables one to “connect the dots” and cultivate serendipity. He presents a goldmine of examples from science, business and life where an apparent mishap or failure lead to a breakthrough.

Indeed, studies suggest that around 50% of major scientific breakthroughs emerge as the result of accidents or coincidences. A well-known example is Alexander Fleming’s discovery of penicillin, launching the whole field of antibiotics. Other examples include X-rays, nylon, microwave ovens, rubber, Velcro, Viagra and Post-it Notes – where would we be without these!

The book goes beyond the ability to recognise and respond to opportunities in chaos, but the subtitle – The Art and Science of Creating Good Luck – is actually a bit misleading. True, he does show ways to develop better fortune, but it would be better to call it “inviting” or “encouraging” good luck. For example, he suggests better ways to start a conversation with a stranger – ways that will make it more likely to lead to chance connections or shared interests.

The publishers may have chosen the word “creating” to make the book appeal to the human desire to control – for control freaks are exactly the readership that would benefit the most from this book’s wisdom and practical advice.

For the rest of us, it offers a great way to rediscover the sense of play that is so important in life – and too often lost in business.


“Following the success of The Serendipity Mindset hardback, a paperback edition has also now been launched under the title “Connect the Dots”.

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