Managed network services are a popular method for IT organizations to outsource the challenges of providing connectivity to their branches and data centers. The wealth of SD-WAN technology solutions—literally dozens of suppliers— has created both opportunities and challenges for managed service providers (MSPs.)
Earlier this year, Doyle Research interviewed 15 U.S.-based MSPs which provide a range of managed SD-WAN services. MSPs included GTT, MNJ, ISS, CISSDM, Step CG, TPx, Masergy, Windstream and Command Link, among others. All of the MSPs reported significant growth in their sales revenues related to SD-WAN. Their customers value their WAN expertise and ability to reduce or eliminate the challenge for IT to evaluate the dozens of competing SD-WAN supplier offerings.
The most impactful findings from the survey:
• MSPs continue to increase the number of their SD-WAN technology suppliers to meet distinct customer requirements – with no vendor emerging as a clear market leader.
• MSPs uniformly are pushing their vendor partners to improve their SD-WAN product offerings in terms of ease of deployment, multitenancy, application to QoS mapping and security management.
Managed SD-WAN services
Managed SD-WAN services is a business model where the complete solution (WAN circuits, hardware, software, and integration) are fully outsourced to an MSP or communications service provider (CSP.) The service provider typically offers SD-WAN services with an agreed amount of bandwidth, redundancy (multiple circuits) for xx number of locations with a specific service level agreement. Pricing is typically via a one year or multi-year service contract, based on the number of sites, reliability, performance and a related service level agreement.
MSPs in the survey reported segmentation of their customer requirements along several key metrics. Some specific customer requirements include the following:
• Fast and easy at small branch locations
• Real time voice/video
• Security and compliance
• Unified platform (SD-branch)
• SD-WAN "lite"
• High reliability
MSPs typically slot a specific SD-WAN vendor offering into one or more of these customer requirements.
Vendor platform diversity
All of the MSPs surveyed have more than one SD-WAN vendor partner , and one offers seven different supplier options. The average MSP has three vendor partners, and each is evaluating new options. MSPs said they need multiple suppliers to meet specific customer requirements for price, simplicity, real time voice, security and reliability.
Vendor suppliers offered by the MSPs in this survey include CloudGenix, VMware, Fortinet, HPE Aruba, Versa Networks, Riverbed, Silver Peak, Cisco, and Oracle while Cradlepoint is a popular partner for 4G LTE/5G connectivity.
“Not all SD-WAN technology is created equal," one of the MSPs said. "We prefer specific vendor solutions for different customer needs.”
Growth of 4G LTE (and 5G) solutions
According to the MSPs surveyed, a majority of new deployments include a 4G LTE card for back-up. Due to wireless data costs, most of the 4G connections are currently used for back-up, but, MSPs expect unlimited wireless data plans (coming soon) to drive 4G/5G as an active-active link with other wired WAN (e.g. Internet) solutions.
Notable MSP quotes include:
- “4G LTE provides excellent performance – exceeding many Internet connectivity options.”
- “All customer conversations now include wireless 4G LTE in some regard.”
MANO improvements still needed
All of the MSPs noted that SD-WAN technology still needs significant improvements in terms of ease of provisioning, management, automation and orchestration. MSPs said that installation is more complex than necessary , and hardly zero touch. They want better edge support for multi-tenancy to serve more than one customer. And, more automation as the process of setting up application prioritization and security are difficult to set-up and maintain.
Notable MSP quotes include:
- “We need better automation, the processes for installation and operation still too manual.”
- “Please improve application mapping to quality of service – without manual intervention.”
- “We need single pane of glass for joint MSP and customer visibility as the service availability and performance.”
The delivery of SD-WAN via a managed service is becoming an extremely popular option for many IT organizations, including small-medium businesses and organizations embracing a “lean IT” philosophy. MSPs (along with large telecom and cable providers) are the leading providers of managed SD-WAN services.
In this 2020 survey, a representative sample of U.S. MSP reported significant growth in demand for SD-WAN services with internet displacing MPLS circuits. The vast majority of MSPs offer multiple SD-WAN solutions based on different suppliers to address unique customer requirements. MSPs also reported increasing interest in 4G/5G solutions and uniformly request improvements in SD-WAN technology automation and orchestration.
Lee Doyle is Principal Analyst at Doyle Research, providing client focused targeted analysis on the Evolution of Intelligent Networks. He has over 25 years’ experience analyzing the IT, network, and telecom markets. Lee has written extensively on such topics as SDN, NFV, enterprise adoption of networking technologies, and IT-Telecom convergence. Before founding Doyle Research, Lee was Group VP for Network, Telecom, and Security research at IDC. Lee holds a B.A. in Economics from Williams College. He can be reached at firstname.lastname@example.org and follow him @leedoyle_dc
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