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Virtual Networks: SDN Market Poised for Fast Growth
Software-Defined Networks (SDN) have the potential to dramatically transform the way that networks are deployed and operated. The goal of SDN is to separate out network control from hardware. In theory hardware costs should fall, and the management of the network should become easier. SDN is similar to a sort of network virtualization.
Dan Mihai Dumitriu, co-founder and CTO of Midokura, a SDN startup that recently raised $17.5 million in venture dollars, said that “As enterprises and carriers embrace and build out IaaS clouds, an overlay-based network virtualization platform will soon be a must-have technology.” Hakan Millroth, CTO for Tail-f Systems, said that “Large companies are clearly captivated by SDN’s potential to improve network automation and simplify the process of provisioning and controlling applications and network services.”
But SDN technology is new, not well understood, and not widely used, at least not yet. InformationWeek, for example, reports that only about 4 percent of the IT groups they surveyed are using SDN in their production environment. The IDC-projected SDN market size is still only about $200 million for 2013. But a GigaOM research report forecasts that the global SDN market will grow from $320 million in 2014 to $2.45 billion by 2018. The IDC projection is that SDN will hit $2 billion as early as 2016.
A study by Tail-f Systems which looked at IT groups for 200 large North American companies found that SDN technology was considered to rank as the highest IT priority for those businesses, higher than cloud, virtualization, and mobility. Businesses say that they want faster networks, faster deployments, and fewer mistakes when deploying applications and services. Carl Moberg, VP of Technology at Tail-f Systems, said that “People want to do roughly what they’re doing now, but do it faster, automated and with less errors.”
