Software Defined Networking (SDN) Market Size By Component (Solutions [Physical Network Infrastructure, SDN Controller, SDN Applications], Services [Professional Services, Managed Services]), By End-Use (Enterprises, Cloud Service Provider, Telecom Service Provider), By Application (BFSI, Consumer Goods & Retail, Government & Defense, Healthcare, Manufacturing, IT Enabled Services), Industry Analysis Report, Regional Outlook (U.S., Canada, UK, Germany, France, Italy, Spain, Netherlands, Australia, China, India, Japan, South Korea, Brazil, Mexico, GCC, North Africa), Growth Potential, Competitive Market Share & Forecast, 2017 - 2024
Published Date: January 2018 | 270 Pages | Report ID: GMI2395 | Report Format:
Software Defined Networking (SDN) Market size in 2016 was over USD 2.2 billion and is estimated to grow at around 54% CAGR over the forecast timespan.
SDN Market Share, By End-Use, 2016
The software defined networking market is set to experience overwhelming growth due to the aggressive carrier efforts to adopt new networking technologies. The increasing pressure to reduce the capital expenditure (CAPEX) and operational expenditure (OPEX) is forcing them to adopt software-defined technologies. The adoption of cloud computing and server virtualization has brought an essential shift in the way computing resources are being deployed, scaled, and managed to drive the same benefits from their network. Apart from sever virtualization technology, carriers have been also aggressively driving network innovation via various channels. For instance, in 2013, the Industry Specification Group (ISG) for NFV under European Telecommunication Standard Institute (ETSI) has been established to fuel the development and adoption of standards for virtualized network functions in telecommunication’s network. Similarly, in 2014, the Open Platform for NFV project (OPNFV) was established to ease the adoption of new NFV products and services among the industry.
However, the complex architecture and lack of skilled professionals are the major constraints in the software defined networking market. The nature of the framework is to act as a connective tissue between networking, computing and storage. Hence, its reach is significantly greater. The number of technologies, protocols and devices with which SDN must be compatible increase the challenges for migrating both the customers and vendors. This is estimated to be one of the major factor that is hindering the growth of the software defined networking market.
Software Defined Networking Market, By Component
The component market comprises solutions and services. The major solutions include physical network infrastructure, SDN controller, and SDN applications. The physical network infrastructure market is estimated to account for major share owing to its ability to orchestrate and manage the flow control between the network elements and applications. Whereas, the SDN controller market is estimated to gain significant growth during the forecast period due to the recent advancement in the northbound and southbound interface and related management & orchestration layer. The growing software defined networking market deployment for enhancing the security of the network is also estimated to drive the demand for controllers.
The service segment consists of professional and managed services. Professional services are estimated to dominate due to the increasing deployment and integration of the solutions among enterprises, cloud service providers and telecom service providers. Furthermore, the growing demand for cost effective and efficient service to reduce the operational expenditure is also supports the growth of the professional service market. Managed services are estimated to witness substantial growth during the forecast period owing to the increasing adoption of managed services, such as network analytics and traffic engineering, among the enterprises and service providers.
Software Defined Networking Market, By End-Use
Enterprises are the leading end-user market due to the growing adoption of the SDN solution to enhance the flexibility and scalability of the network infrastructure. Furthermore, the benefits offered by the SDN solution such as centralized control, reduced complexity, higher rate of innovation, security and reliability is also one of the primary factors that are fueling the adoption among enterprises.
Software Defined Networking Market, By Application
IT enabled service led the application market owing to the increasing adoption of the SDN solutions among enterprises to enable on-demand provision of network and its services. Furthermore, the increasing adoption of web-based applications and services among enterprises along with the growing need to reduce the capital and operational expenditure also augments the growth of the market.
Software Defined Networking Market, By Region
U.S. is the leading country in the global SDN market due to the investment by the telecom service providers in SDN to improve their infrastructure capabilities to cope with the increasing network requirement. For instance, in 2017, telecom giant AT&T invested over USD 200 million to support SDN based start-ups. Furthermore, high internet penetration and increasing 4G adoption are also one of the major factors that is contributing towards the growth of the market. In addition, presence of number of players such as IBM, Cisco, VMware, and Big Switch Network also foster the market growth.
Competitive Market Share
The software defined networking market is characterized by the presence of number of players ranging from major service providers to the start-ups. Some of the major vendors are Cisco, IBM, HP, Intel, Big Switch Network, Juniper, Arista Network, Huawei, Extreme Networks, NEC Corporation, Pics8, AT&T, Pluribus, and Plexxi. Now, players are focusing on product development, merger and acquisition, partnership and collaboration to gain market share and be competitive. For instance, in 2017, Broadcom Limited acquired Brocade Communication Systems to strengthen its position in the market.
SDN Industry Background
SDN is a novel approach to the networking that facilitates the network management and provides a programmatically efficient network configuration to enhance network performance. It focuses on providing an open interface that assist in the development of the software that can control the connectivity provided by the network resources. The explosion of the content and mobile devices, advent of cloud services, and server virtualization are among the major trends driving the growth of the software defined networking market. The traditional network architecture made sense when the client server computing was dominant. However, such static architecture is unsuitable to the dynamic computing and storage needs of the today’s carrier environment and enterprises, leading to SDN market adoption.
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