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Five reasons why CIO’s should consider WAN Virtualisation on the agenda now

The potentials of WAN Virtualisation, or Software Defined WAN (SD-WAN) are defined by the ability to decentralise network functions from main locations to branches. This need is triggered by the demands of Business Digitalisation, Industry 4.0 and Workforce Empowerment, when people, data and processes are becoming independent from geographical locations.  The remaining question for many CIO’s is: When it’s the right time to set this topic on the agenda. Here are five reasons, why the answer is – now:

Adapting is less expensive than reacting

Most of the Enterprise WAN architectures in place today are following a centralized concept. This made sense in order to prevent overhead cost by concentrating expensive equipment and IT personell on a single or just a few locations. But driven by an increasing number of mobile devices and cloud applications, backhauling traffic to a centralized internet access shows up the limits of centralized architectures. There is no break of this trend at all. According to the Visual Network Indicator (VNI), globally, IP traffic will reach 168.0 Exabytes per month in 2019, up from 59.8 Exabytes per month in 2014. There is nothing wrong with your architecture itself, but driven by – what is called the “Shift to services democratizes economy” the requirements are beginning to change must faster than in the past. Fighting against-, instead of adapting them, can cost your company a lot of money.

Changing a Enterprise WAN architecture takes time

Enterprise wide networks are usually historically grown and often closely depending on security architectures. Dezentralization of a network architecture does not take place over night. It take some time. As it is common in changing technologies, there are some principals to be considered and a transition scenario has to be outlined. A very good overview is provided by the Software Defined Networking for Dummies by Brian Underdahl/Gary Kinghorn, free available as ebook. Defining the appropriate requirements and the evaluation of critical dependencies should considered carefully.

Your competitor will do it

According to Gartners – IT spending forecast Communication Services, including Enterprise WAN costs are traditionally one of the top positions for IT spendings worldwide. While virtualisation, cloud- and mobile computing potentially reduce infrastructure costs – spendings for connectivity remains unchanged or are even raising.  (Because declining prices where usually overcompensated by the need for more bandwidth, or countermeasures to better manage it.) Therefore, a de-centralised Enterprise WAN offers a way to significantly lower your entire IT costs. This means you have to choices: Achieve a competition advantage – or wait, until your competitor moves first.

Waiting for your ISP could cost you a lot of money

MPLS is the prefered technology of almost every Internet Service Provider today. Therefore the Internet Service Provider is the native supplier of Enterprise WAN solution in the future, right? Perhaps not. There are some reasons, why the Internet Service Providers will not the first one, providing you a more cost-efficient alternative to MPLS:

  • Internet Service Providers have made huge investment in MPLS infrastructure and global partnerships in the last decades. Therefore, there is no interest to set this interest at risk
  • Internet Service Providers are usually conservative in technology adaption than IT is in general. New technologies such as Cloud, SDN and SD-WAN are driven more by IT related technolgies than on classical Telco

Considering this reason, it is not astonishing, that market researches accordingly are forecasting dramatically market changes in this sector. As Forrester Research recently stated in their predictions 2015: “Only a minority of telecoms will manage to reinvent their business model to help win, serve and retain customers”. The “Dead of MPLS” was already announced by Gartner in 2013, unleashing a controversal discussion. 

Even if the times are not changing so fast as predicted: You should keep your eyes open, because your ideal “Next Generation Enterprise WAN” may not be delivered by your Internet Service Provider.

Security is not a show stopper

To be clear: Security aspects are a concern for every technological development and should never be underestimated. Regarding Enterprise WAN Architectures, there is often a misunderstanding. Centralising or de-centralising is not primarily a security issue, it is more a cost factor. Concentrating your expensive Network- and Security Infrastructure on one- or just a few locations – is less expensive than to distribute them to all your locations. Now, Software Defined WAN becomes an enabler for the centralised management of a distributed Enterprise WAN architecture. And this is finally the great advantage of Software Defined Networking at all.

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