Carrier SDN market to reach $8.7B in 2020, says IHS

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The market for service provider software-defined networking (SDN), including hardware, software and services, is forecast to grow with a 2015–2020 compound annual growth rate (CAGR) of 98 per cent, taking it from $289 million in 2015 to $8.7 billion in 2020.

That’s the latest forecast from IHS Technology, which examines the markets and trends related to building service provider software-defined networks.

‘Carriers have defined the vision, goals and architectures and are progressing through use cases, proof-of-concept projects, field trials and a small but growing number of commercial deployments. The partially proven promise keeps the industry moving as fast as it can, but we are still early in this long-term, 10- to 15-year transformation of service provider networks,’ said Michael Howard, senior research director and advisor, carrier networks, IHS Technology.

SDN deployments started in Japan with NEC and NTT, and the country has been active in deploying real but small commercial deployments. China now has many sizeable commercial deployments in 2015 and 2016.

Not to be left out, service providers in North America and Europe are also testing the waters with SDN, and are anticipated to account for 13 per cent of total revenues in the period 2015–2020.

SDN and NFV represent the shift from a hardware focus to software one: accordingly, software and outsourced services will comprise 46 per cent of SDN revenue in 2020.

SDN orchestration and controller software revenue is forecast to grow to more than $1.8 billion in 2020. By then, there will be more value in SDN apps than in orchestration and control, which will be priced reasonably due to competitive pressure, the analyst firm says.

The annual IHS carrier SDN market size and forecast report examines the markets and trends related to building service provider software-defined networks. Specifically, the report tracks software that provides orchestration, controller and application functions; outsourced services for SDN projects; and hardware in use for SDN networks, including routers, switches, wavelength-division multiplexing (WDM) and video content delivery network (CDN) equipment, and other telecom equipment controlled by SDN orchestration and controllers, such as customer premises equipment (CPE).

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