Enterprises see value in SDN for data center deployments, says Infonetics

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Service providers may be the early adopters of Software Defined Networking (SDN), but according to a new Infonetics survey a growing base of North American-based enterprises either are planning or have already deployed the technology in their data centers.

Infonetics data center technology investment

"Nearly 1/4 of the enterprises we interviewed for our new data center and SDN survey have already deployed SDN technology in their data centers, and 1/3 plan to do so by the end of next year," said Sam Barnett, directing analyst for data center and cloud at Infonetics Research. "This is impressive given the nascent nature of most SDN technologies and the relatively sophisticated IT community required to implement them."

While the SDN market is still nascent, enterprises told Infonetics they see value in the technology for three main reasons: improving virtualization, security, and application performance.

Leading the market from a SDN-based vendor perspective are Cisco (Nasdaq: CSCO) and IBM (NYSE: IBM). Both of these vendors are either installed in data centers or are being evaluated for new projects.

At the same time that enterprises are evaluating SDN, data center operators continue to make investments in three areas. Seventy percent are upping storage spending, 67 percent are increasing spending on cloud services, and 59 percent are increasing spending on physical servers.

Evidence of the data center spending trend continues to be seen with traditional data center providers like Equinix (Nasdaq: EQIX), which has been expanding its presence in key emerging markets such as Latin America, as well as traditional telcos like CenturyLink (NYSE: CTL) and Verizon (NYSE: VZ) through their Savvis and Terremark units.

While CenturyLink won't announce its Q3 earnings until Nov. 7, Verizon reported in Q3 that strategic services sales such as cloud and Ethernet rose 4.4 percent over Q3 2011 and represented 53 percent of global enterprise revenues in third-quarter 2012. 

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