Futuriom Looks Into the SD-WAN Crystal Ball

August 29, 2017

By Paula Bernier - Executive Editor, TMC

A new study by Futuriom projects big growth for SD-WAN in the coming years. It also predicts “a huge shakeout” of the SD-WAN market players between now and 2019. During that time, it says, at least two of the companies will go public and attain leadership status while many of the others are acquired or otherwise fade away.

Aryaka (News - Alert), Cradlepoint, and Fat Pipe Inc. are the most likely to file for IPOs in the near term, according to Futuriom. And if these leading venture-backed startups don’t go public, Futuriom opines, they are likely to be the top acquisition candidates.

Here are some points that make these three players noteworthy in the crowded SD-WAN marketplace, according to Futuriom:

• Aryaka, a global SD-WAN network-as-a-service company, had 26 points of presence in the first half, has more than 300 employees, may be the first SD-WAN startup to reach $100 million in revenue, and has leaders who have expressed interest in an IPO.

• Cradlepoint offers a broad product portfolio, but it expanded its position in SD-WAN with the 2015 acquisition of Pertino Networks. And it has an impressive customer base, including more than half the Fortune 100.

• Fat Pipe is profitable, has a solid roster of customers, and has been around longer than many of its startup peers.

Futuriom adds that Cisco (News - Alert)/Viptela and TELoIP are other SD-WAN players to watch. That’s because Cisco is Cisco. And TELoIP is interesting, Futuriom says, because it has a good number of paying customers, a strong intellectual property portfolio, and management with close connections to top service providers in North America.

The research firm also lists Citrix, Huawei, Nuage Networks, Riverbed (News - Alert) Networks, and Versa Networks as emerging SD-WAN players to watch. Futuriom goes on to say this: “Traditional global service providers such as AT&T, Deutsche Telekom, Telefonica, and Verizon (News - Alert) are falling behind in SD-WAN to existing NaaS vendors, and they will be forced to accelerate their SD-WAN service deployment. This may include buying SD-WAN startups.”

Growth in SD-WAN technology tools and network-as-a-service revenues is poised for better than 30 percent growth over the next five years, according to Futuriom, and 75 to 100 percent growth from 2017 to 2018. Revenue from SD-WAN tools and NaaS revenue will approach $1 billion by 2019 and $1.6 billion by 2021.

SD-WAN has many ancillary revenue streams, Futuriom adds. That includes cloud optimization, enhanced security, and network analytics and monitoring services.

Edited by Mandi Nowitz

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