Realizing Economic Value from SD-WAN

August 7, 2018

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Many vendors have recently come out with “SD-WAN” solutions. One might get the impression it’s very low hanging fruit for any software/systems company who wants to give it a try. What makes SD-WAN seem so simple that anyone could do it? Answer: It actually is simple.

The hard part of SD-WAN comes with realizing the economic value that’s always promised by the vendors. Hard economic value can derive from one or more of the following 3 sources:

  • Reduce WAN cost by shifting traffic to lower cost Internet VPN*
  • Reduce WAN cost through compression & caching*
  • Reduce WAN administration cost by using repeatable profiles & cloud-based administration

* – Savings through reducing the size of MPLS links to remote sites

For economic value not including potential WAN performance gains, that’s all there is to it. If we expand the scope to include (potential) performance gains, there can be added value from User Application Experience (UX) and reliability due to:

  • SD-WAN selects link by traffic type based on application requirements – some apps benefit from fat/cheap Internet VPN bandwidth even though that bandwidth can have unpredictable latency and reliability, other apps can’t tolerate packet loss & latency
  • Multiple WAN paths including MPLS, Internet VPN, and Cellular/LTE are more resilient than any single WAN path

Note: Firewall functionality not included as it’s not added value, already exists in legacy WAN routers

Two more items of note: Since WAN’s last-mile handoff today is typically Ethernet, the need for an actual router at each site is largely gone. An optimal SD-WAN CPE/endpoint for each site is little more than an x86 server with multiple Ethernet ports, hence the name “Software Defined” i.e. the hardware is commodity. Strangely, total cost for the CPE/endpoint hasn’t changed much, just that cost has shifted from hardware to software.

Lastly, the potential of the SD-WAN “plug-in” software, aka NFV or Network Function Virtualization. This is more of an element of Service Provider SD-WAN that you would get from AT&T or Verizon. Firewalls, Intrusion Prevention Sensors, Data Loss Prevention, and other plug-in solutions can be ordered from the Service Provider (added cost per month). Some see plug-ins as added value but note that SD-WAN from a Service Provider will not focus on reducing your WAN cost, only increasing it.

Ready to begin looking at SD-WAN solutions or any other networking consulting?  Fill out our interactive quick assessment to begin realizing the value of software-defined in your environment:

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