The market for software-defined networking equipment is set to surge over the next five years as wireless carriers look bolster service offerings and cut costs, according to a new report from ACG Research.
The report predicts that annual spending on all SDN-related equipment could hit $29.5 billion per year by 2018, compared with less than $4.5 billion expected to be spent this year. For actual equipment set to be used in live network operations that growth is forecast to increase from $858 million this year to $15 billion by 2018.
ACG added that software will make up approximately 20% of those sales totals by 2018, with the revenue split between SDN controller and SDN service control applications moving from an even split this year to a 60/40 split favoring applications by 2018.
The largest SDN segment is expected to be data centers for cloud IT and application services, representing more than 50% of live SDN deployments through 2016, according to ACG. As for top carrier SDN use cases, ACG listed:
–Automatic service provisioning.
–Traffic steering.
–Custom application/service and feature deployments.
–Dynamic policy management.
–SLA monitoring and enforcement.
–Operations simplification.
–Capital expenditure minimization
“Live SDN deployments in [wide-area network] IP and transport solutions will gain significant traction, and the edge, metro and core domains will each become larger as a percentage of total [service provider] SDN sales than the data centers are by 2018 (including both hardware and software SDN products),” ACG wrote in the report. “This is driven by the diversity of platforms participating in SDN solutions in those domains (IP/MPLS, Ethernet/MPLS, optical and packet optical transport systems, as prime examples), the broad extent of their deployment in [service provider] infrastructures globally, and the range of optimizations in each domain being ushered in as part of the SDN transformation over time.”
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