SD-WAN Revenue Hit $284 Million in 3Q 2018; Cloud Providers, Telecom Providers Stake a Claim

Revenue from SD-WAN (appliance + control and management software) reached $284 million in 3Q 2018, up 23 percent quarter-over-quarter (QoQ), according to a new report from IHS Markit.


VMware led the SD-WAN market with a 19 percent share of 3Q 2018 revenue, Cisco moved into second place with 13 percent revenue share, and Aryaka is in close third, according to the DC Network Equipment market tracker early edition from IHS Markit.

In 3Q 2018, VMware and Azure announced an SD-WAN partnership worth closer scrutiny, as Azure wants to offer backbone connectivity as part of its service, allowing customers to “exit” to the Internet at different points of presence. This means Azure domain controllers (DCs) are no longer only an end point, potentially making Azure competitive with other global networking providers.

 Citrix, Versa Networks and Riverbed also announced availability of their SD-WAN offerings via Azure and AWS. Oracle took this one step further by stating its intent to acquire Talari Networks to enable greater connectivity to its Oracle Cloud offering; it also integrated Aryaka’s SD-WAN capabilities, giving its enterprise customers a choice of SD-WAN provider

“Cloud service providers have begun to realize the importance of bundling SD-WAN as part of a cloud service, ensuring a positive user experience when utilizing SaaS-based applications such as Office 365 or while migrating workloads to AWS or Microsoft Azure.” said Cliff Grossner, senior research director and advisor for cloud and data center at IHS Markit.

“Although the SD-WAN market is maturing, we still see a plethora of SD-WAN vendors in the market, and carriers are beginning to show concerns that when integrating an SD-WAN vendor into their network, there is a risk the SD-WAN vendor could be acquired or drastically change offerings in a year,” Grossner continued.

As a result, carriers are selecting multiple SD-WAN vendors, creating frustration and integration complexity when there is a lack of interoperability with carrier APIs” said Josh Bancroft, senior research analyst at IHS Markit.

More Data Center Network Market Highlights:

  • 3Q 2018 application delivery controller (ADC) revenue increased 2 percent from 2Q 2018 to $457 million and declined 3 percent from 3Q 2017

  • Virtual ADC appliances stood at 34 percent of 3Q 2018 ADC revenue

  • F5 garnered 49 percent share of the ADC market share in 3Q 2018 with revenue up 4 percent YoY. Citrix was in second place with 26 percent of revenue, and A10 (8 percent) rounded out the top three market share spots.

(For more information visit: