For those of you following the SD-WAN market, it comes as no surprise that VMware has announced its intent to acquire VeloCloud for an undisclosed amount. So how does it affect the SD-WAN market, and what does the future hold?

VMware’s latest acquisition: A case of ‘me too’?

VMware’s acquisition of VeloCloud comes on the heels of Cisco’s Viptela acquisition earlier this year. Don’t, however, dismiss VMware’s purchase as a “me too.”

VMware’s announcement is aligned with its commitment to software defined networking (SDN) as an architectural framework and its NSX offering. VeloCloud extends SDN capabilities to the most prevalent use case, software-defined WAN. Many VMware customers have been asking their sales reps about SD-WAN and the purchase of VeloCloud provides the answer.

Cisco, rightly, views this move as a competitive threat. VMware is moving squarely into its territory. It means that Cisco will need to make good on its Viptela acquisition, doubling down on R&D and on integration efforts. Cisco may go so far as to rationalise its portfolio in SD-WAN, which currently spans four offerings.

Rethinking the network

SD-WAN technology is causing IT and network teams to rethink their entire networks.

“If organisations are to harness the power of digital transformation, it’s time for the network to evolve,” according to Zeus Kerravala, industry analyst. “Resiliency, operational efficiency and agile orchestration capabilities are now table stakes and must be part of the network design. However, this can’t be delivered with legacy networks.”

Traditional WANs relied upon error-prone manual configurations, long lead times and costly MPLS protocols. Next generation SD-WANs decouple the control and data plane in order to centrally manage the WAN using software. SD-WANs help organisations benefit from automation, optimised routing, and lower costs while still leveraging their existing hardware and bandwidth investments.

With this type of flexibility and ability to overlay SD-WAN on existing networks, it’s no wonder network managers are taking a serious look at the technology. Research firm Forrester estimates that 90% percent of network managers are looking to evolve their WAN using a software-defined approach.

Factor in the cloud

Cloud-based applications are further stressing the existing network infrastructure as they become the preferred platform. Companies now run 79% of workloads in cloud, with 41% of workloads in public cloud and 38% in private cloud, according to RightScale’s State of the Cloud 2017.

IT organisations traditionally backhauled cloud traffic from remote/branch sites through a central point of access in hub-spoke configurations. These additional hops cause unacceptable application latency, incremental cost and network congestion. Many IT teams have increased the number of break-out points to the cloud but still rely upon manual configuration and updates.

SD-WAN has proven invaluable to companies with large numbers of users spread across many sites who are accessing cloud-based applications. With SD-WAN, these organisations are now able to centrally orchestrate and manage direct connections from geographically dispersed locations to the cloud. They can define and instantly apply policies that govern security and performance across the network using one management console.

The future of SD-WAN

Expectations are high for SD-WAN. Research firm IDC predicts SD-WAN will be a more than $1 billion market this year and growth at 69% to more than $8 billion by 2021. VeloCloud alone boasts 1,000 customers and 50 service providers.

Like compute and storage, networking will move to software-defined architectures to take advantage of agility and cost savings. SD-WAN is the most compelling use case to date; product maturity is accelerating the p­­­ace of deployments and simplifying ongoing management/orchestration. With SD-WAN, error prone, manual configuration becomes a relic of the past.

SimplePay, a financial and insurance platform based in Australia, is a case in point. In explaining why SimplePay made the move to SD-WAN, Rob Gillan, chief technology officer said, “The (network) systems were working fine for us locally in Australia, but I recognised early on that they couldn’t be easily scaled across the globe or easily managed from a reliability and sustainability perspective. We didn’t want to have to drop IT staff in to every new location.”

SD-WAN wish list

Almost all SD-WAN vendors today provide the ability to leverage any combination of different network connections, define network path selection based on business requirements, and provide direct internet access.

Many vendors are now going beyond these core capabilities and are integrating security, public cloud connectivity, and application performance management into the mix. Some also allow administrators to deploy their products without the need to rip and replace the existing network infrastructure.

Organisations evaluating SD-WAN should consider the following:

Security: Many SD-WAN appliances come with a good firewall, which combined with a VPN, supports most use cases. Confidential traffic can be routed for additional protection through more robust firewalls or through a cloud-based security service, such as Zscaler, as needed. In this case, the SD-WAN will abstract away the complexity of connecting to the cloud security service. Business policy rules can be easily set within the management console to authorise which traffic must go to the cloud-based service and which traffic is either backhauled or sent directly through the Internet.

Public cloud integrations: SD-WAN can be deployed as a gateway inside Microsoft Azure or AWS public clouds to manage the network traffic of a customer’s application as it enters or exits the cloud. In this case, the SD-WAN is deployed as a software instance running on an IaaS stack. SD-WAN fees can be passed through to the cloud provider for simplified, usage-based billing.

Digital experience management: IT teams often feel a loss of control as their reliance on cloud-based applications increases. Uncertainty due to visibility gaps between siloed monitoring tools is a common issue. Integrated digital experience management (DEM) tools can provide visibility from the end-user device across the network and into the application, whether it runs on-premises or in the cloud. DEM gives IT the ability to detect and troubleshoot performance problems before they affect users.

Key takeaways

Here are a few key takeaways as you move from legacy to next generation networks:

• SD-WAN technology is now mainstream; many smaller competitors have been absorbed by established vendors with the wherewithal to invest in R&D and public cloud connectivity.
• Cost savings are a given; agility, performance and security are equally important to end users who have come to expect consistently high levels of service.
• In the near term, SD-WAN technologies should allow customers to adopt gradually while continuing to use existing network equipment and protocols.

The ongoing shift to cloud computing continues across the globe. The worldwide public cloud services market grew 28.6 percent year-over-year in the first half of 2017 (1H17) with revenues totaling $63.2 billion, according to the latest market study by International Data Corporation (IDC).

"Public cloud adoption is accelerating in large part as enterprises recognize that the cloud has become the launchpad for virtually every new IT innovation in the last 24 months — including AI, blockchain, quantum computing and more," said Frank Gens, senior vice president and chief analyst at IDC.

Public cloud market development

While stronger than expected growth was seen across all regions, Asia-Pacific saw the highest regional growth at 38.9 percent and this market now represents 11.5 percent of all public cloud services revenues. Strong public cloud spending in China, which saw 55.6 percent year-over-year growth in the first half of 2017, is a key driver.

Among the three primary segments of public cloud services (SaaS, PaaS and IaaS), the SaaS segment, which holds 68.7 percent of overall market share, was the slowest growing segment with a 22.9 percent year-over-year growth rate.

More CIOs and CTOs now think 'cloud first' when it comes to their IT strategy and software footprint, since the benefits of cloud have been demonstrated in most industries. Many companies have picked the low-hanging fruit, in terms of apps that could be easily moved to the cloud, and are now evaluating the potential migration of their next set of larger strategic systems to a SaaS model.

That said, the smallest segment overall was PaaS, with 13.6 percent of the public cloud services market. However, the PaaS market continues to deliver stronger growth than the other two segments at 50.2 percent year-over-year in 1H17.

According to the IDC assessment, the rapid adoption of container technology in the PaaS segment has given developers additional tools to accelerate application development and deployment that is important in the typical enterprise digital transformation journey.

Outlook for private cloud applications

The IaaS segment represented 17.8 percent of the public cloud services market in 1H17, and continues to exhibit strong year-over-year growth at 38.1 percent. Growing interest from enterprises and continued investments by cloud service providers has resulted in enhancements in the IaaS segment across multiple dimensions.

The recent introduction of on-premises offerings into the market also enable easier hybrid IT models, and reduce the barrier to more cloud service adoption for enterprises. Cumulatively, these are paving the way for the next wave of enterprise application deployments on cloud computing IaaS.

Read more: IDC says global public cloud revenues hit $63 billion – with PaaS quickest growing segment

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When your correspondent wrote last week, to open the news that Google was becoming Salesforce’s preferred cloud provider, ‘meet the cloud’s newest strategic partners’, it was always going to be a short-lived title.

And so it has proved: Hewlett Packard Enterprise (HPE) and Rackspace have announced a partnership to offer what is claimed as the industry’s first pay as you go OpenStack private cloud.

The pay as you go pricing model will leverage HPE’s Flexible Capacity infrastructure service, with savings of 40% or more compared to leading public cloud vendors according to Rackspace internal pricing analysis. Aside from the pricing, other key features of the combined offering include instant scalability, enterprise-grade security, and managed services expertise.

Rackspace has been focusing many of its efforts on bolstering this expertise of late. The company acquired managed service provider Datapipe in September in what it called the ‘biggest acquisition by far’ in its history.

“With this innovative delivery model, Rackspace and HPE are removing the barriers to private cloud adoption, giving customers even more choice of technology platforms that best fit their application needs,” said Scott Crenshaw, Rackspace executive vice president of private cloud in a statement. “We are proud to partner with HPE to continue enabling customer success with private clouds.”

Michelle Bailey, group vice president at IDC Research, added: “The OpenStack Private Cloud offering from Rackspace and HPE specifically addresses organisations’ needs to provide security and performance benefits, the cornerstone of a private cloud environment.

“With Rackspace’s private cloud expertise and service-first culture, they are well positioned to address the needs of HPE’s large installed base of infrastructure customers and help reduce any cloud migration risk. This pay-per-use infrastructure is a new step forward in helping enterprises deploy private clouds with improved flexibility and cost transparency.”

The service will become generally available in all regions on November 28, with the two companies adding they plan to extend this model to Rackspace’s entire managed private cloud portfolio, including VMware and Microsoft Azure.

IBM has been solidly building its efforts in quantum computing over the past couple of years – and a new milestone has been reached with the launch of upgraded systems featuring 20 qubit processors, with 50 qubits on the way.

The company describes the latest news as “rapid advances in quantum hardware… as IBM continues to drive progress across the entire quantum computing technology stack, with focus on systems, software, applications and enablement.”

Quantum computing is gaining prominence as a significantly more powerful alternative to classical computing. The latter is based around bits which can only exist in 1 and 0 states, while the former, built on the principles of quantum mechanics, aims to take advantage of subatomic particles existing in more than one state at any time. A qubit is the quantum equivalent of the classical bit.

The idea therefore is that in this state, algorithms can be run and conclusions drawn which current computing methods simply cannot comprehend; ‘we expect them to open doors that we once thought would remain locked indefinitely’, as IBM itself puts it.

One issue in this is the concept of coherence, the amount of time machines can exist in this quantum state before reverting to their classical equivalents. Today, the maximum time available to researchers is 90 microseconds; not a huge amount one would normally think, but this does represent serious progress from even the past couple of years.

As this publication noted 18 months ago when IBM launched its five qubit quantum processor, the company stated that medium-sized quantum processors of 50-100 qubits will be possible ‘in the next decade.’

IBM added that the 50 qubit processor had been built and measured, adding that it will be made available in the next generation IBM Q systems, though not specifying a date.

“The ability to reliably operate several working quantum systems and putting them online was not possible just a few years ago. Now, we can scale IBM processors up to 50 qubits due to tremendous feats of science and engineering,” said Dario Gil, vice president of AI and IBM Q at IBM Research.

“These latest advances show that we are quickly making quantum systems and tools available that could offer an advantage for tackling problems outside the realm of classical machines,” Gil added.

You can find out more about the announcement here.

Read more: Why IBM believes quantum computing is the next big cloud hit after AI and blockchain

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