SD-WAN Revenue Reached $444 Million in 2017, IHS Markit Finds

SD-WAN (appliance + control and management software) revenue reached $147 million in 4Q 2017, with current year (CY) 2017 up 3.9 times over CY16, according to new research from IHS Markit.


VeloCloud (acquired by VMware) led the SD-WAN market with a 19 percent share of 4Q 2017 revenue, Aryaka was in second place with 17 percent revenue share, and Silver Peak rounded out the top three with 12 percent, according to the DC Network Equipment market tracker early edition from IHS Markit.

“Reviewing recent wins, we can see a market that is maturing with a transition from early market adopters to mainstream buyers,” said Cliff Grossner, Ph.D., senior research director and advisor for the Cloud and Data Center Research Practice at IHS Markit.  Other signs of maturation include expansions at existing clients and incremental product offerings such as security and WAN optimization on top of basic WAN transport virtualization.

“One noteworthy element,” Grossner said, “we must not lose sight that SD-WAN is equally important for voice and data even though data gets much of the attention in discussions. We can also expect a next wave of features focused on analytics, making use of the rich telemetry data available with SD-WAN.”

Other market highlights include:

  • Software-defined enterprise WAN revenue increased 20 percent quarter-over-quarter (QoQ) from 3Q17.
  • 4Q 2017 ADC revenue increased 1 percent QoQ from 3Q17 and decreased 3 percent year-over-year (YoY) from 4Q 2016.
  • In CY 2017, ADC revenue was down 5 percent over CY 2016
  • Virtual ADC appliances stood at 29 percent of 4Q 2017 ADC revenue
  • F5 garnered 42 percent ADC market share in 4Q17 with revenue down 4 percent YoY.
  • Citrix had the number two spot with 30 percent of revenue.
  • A10 rounded out the top three with 9 percent market share.

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