Beating the SD-WAN Drum

Peter : On Rad's Radar?
Peter
| Peter Radizeski of RAD-INFO, Inc. talking telecom, Cloud, VoIP, CLEC, and The Channel.

Beating the SD-WAN Drum

I was shocked that Cisco bought Viptela for >$600M. I thought Cisco would buy Velocloud. (Someone will soon.) With Viptela, Cisco keeps Verizon as a customer. It also gets partnerships with CA, SingTel, Westcon, EMC and zScaler. That should be interesting.

On an agent webinar this morning, Windstream is beating the SD-WAN drum. I understand that SD-WAN is a boon to retail, restaurants, branch offices and rural locations. Not every business wants to pay over $500 for a pipe. They want to pay what they were paying for T1s. SD-WAN will be a boon for broadband providers - satellite, 4G/LTE, fixed wireless, DSL and cable modem. It swings the WAN back to IP-VPN. Is that a great idea in the age of Hacking?

There are other benefits for SD-WAN: ease of management; faster deployment; analytics; transparency; failover/redundancy; but the bell that most CIOs rang at the WAN Summit in NYC was cost savings.

We are going to see a bunch of locations move from dedicated Internet (DIA or MIS) to broadband. From a commission standpoint that will suck. From a vendor standpoint that will be a pain. However, if partners layer on SD-WAN from a provider plus two broadband providers, we might be able to keep the MRR close. This will become the standard configuration for many business locations.

That is the drum that is beating.

As an RLEC (rural ILEC), revenue streams heavily favored consumer services. The RLECs had USF and TDM transitions occur to shake up their business models. Also, cable starting eating their lunch. DSL didn't cut it. The RLECs had to spend to beef up the network for both better broadband and Telco TV. They just did it too late. Now they have to chase the business markets with HPBX, SD-WAN, cloud services and anything else to bring revenue in and margin back.

CLEC margins on resold network are thin. UC isn't killing it, for anyone. Managed services is where the margin is. SD-WAN is just another technology that needs to be deployed for the customer and managed (like managed router or a monitored Internet pipe).

That is why the drum is beating.

Viptela puts it nicely, "In today's fiercely competitive digital-driven marketplace, enterprises must remove complexity from the WAN. WANs need to be easier to manage, cost-efficient, more agile and available, and better aligned with an organization's computer and business needs. The SD-WAN is quickly becoming an essential component of enterprise digital transformation."

This makes it sound like WAN is complex. It isn't really. MPLS is not that hard or complicated. It is easier than IP-VPN and more secure. (Or at least it is for me.) With many network operators connected to cloud platforms (like AWS, Rackspace and Azure), adding a direct connection to a WAN is simple. (Or if the customer has a data center presence,he can tap into the cloud via a peering fabric.) There are ways to architect a secure, manageable WAN.

Partners will be selling SD-WAN, the flavor of the year. I just wish they had not all been calling it SD-WAN and had actually incorporated it into a branded service offering. That could have led to differentiation and some targeting so it doesn't become a commodity so fast. (Oops! Too late.)



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