In the second half of 2018, VMware held a slight edge over Cisco for in-use enterprise software-defined networking market revenue.
According to a report by IHS Markit, VMware held the top spot with 22% of in-use SDN revenue in the second half of 2018 while Cisco was second with 19%. Rounding out the top results, Arista Networks was third (15%) while white-box vendors came in fourth (10%) and Huawei was fifth (8%).
Cisco Application-Centric Infrastructure (ACI) and VMware NSX have long been combatants across the software-defined networking and virtualization sectors and now they are going head-to-head with their cloud, data-center and edge product positioning.
In January, Cisco launched its ACI Anywhere update at Cisco Live in Barcelona. The following month, VMware counter-punched with a major upgrade to NSX, which included NSX-T Data Center 2.4 and NSX Cloud. After those updates and enhancements, IHS Markit said that both vendors were rewarded with an increase of production trials and live deployments with new enterprise customers.
“In the second half of 2018, we saw verticals such as healthcare, education and government being most prevalent with completing their production trials with DC SDN,” said Josh Bancroft, senior research analyst at IHS Markit, in a statement. “These enterprises are focusing on re-architecting their networking infrastructure to achieve greater network security, automation, and application performance.”
In an email to FierceTelecom, Bancroft said IHS Markit tracks both in-use and not-in-use SDN to illustrate the total market of SDN. An SDN-capable Ethernet switch is considered “in-use” where traffic flow is actively controlled by, and/or network state information is exchanged with, an SDN controller, orchestration software, or application, according to Bancroft.
An example of “not-in-use” would be an SDN-capable Ethernet switch where traffic flow is not actively controlled by, and network state information is not exchanged with, an SDN controller, orchestration software, or application.
In-use data center (DC) and enterprise SDN market revenue increased by 34% in second half of 2018 compared to the first half and is expected to continue to reach $20 billion by the end of 2023, up from $7 billion in 2018, according to IHS Markit.
The DC and enterprise SDN segment includes SDN in-use Ethernet switches, SDN controllers, SD-WAN appliances and SD-WAN control and management software.
“From the edge, to the on-premises data center, to the off-premises cloud, enterprises are continuing their march toward running applications in distributed IT environments,” Bancroft said. “This transition is important for DC SDN adoption, and enterprises are going full steam ahead to get their SDN lab and production trials completed.”
The IHS Markit Data Center and Enterprise SDN Hardware and Software report also noted that intent-based networking was starting to gain traction. According to an IHS Markit Data Center SDN Strategies Survey, 46% of the respondents said the adoption of intent-based networking (IBN) was an important SDN deployment driver.
Cisco introduced intent-based networking with the launch of its DNA Center in 2017 before its Cisco Live event. During Cisco's third-quarter earnings call in May, Cisco CEO Chuck Robbins said his company had rebuilt its entire access portfolio with IBN across its wired and wireless divisions. Over the past several years, Cisco has also been working to integrate IBN into its enterprise access portfolio as well.
In the second half of last year, Cisco enhanced its intent-based networking solution to have more integration with ACI. At Mobile World Congress in February, Huawei launched its intent-based network solution.
A previous IHS Markit report found that open-switch operating systems (OS) had not reached the maturity needed for wide-scale bare-metal switch adoption, but IHS noted that has changed a bit in its most recent report. There have been broader efforts to not only advance the maturity of the switch OS but also to enhance the operating systems with new networking and intent-based features, according to IHS Markit.
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Last year, the Linux Foundation announced the Disaggregated Network Operating System (DANOS) project to enable community collaboration across network hardware, forwarding and operating system layers. DANOS is based on AT&T’s “dNOS” software framework, but to date AT&T hasn't put DANOS into the Linux Foundation, although it has said it will do so sometime this year.
“If successful, vendors such as Arrcus, SnapRoute, Cumulus Networks and Pluribus Networks will all help fuel the adoption of bare-metal switches running on their OS,” Bancroft said. "The next big innovation in switching is the inclusion of special-purpose artificial-intelligence (AI) silicon within the switch.
“Huawei leads the pack with its announcement of the Ascend 910, which is included in the new Cloud Engine 16800. We can expect the bare-metal switch vendors to follow, and this is also expected to fuel SDN bare-metal switch adoption.”
Going forward, in-use virtual switch ports will account for 66% of SDN-capable ports shipped in 2023, while not-in-use virtual switch ports will account for 19%, according to IHS. Lastly, the report said that revenue from in-use SDN controllers is expected to hit $3.8 billion by 2023.