As enterprises emerge from the Covid shock, there is an urgent need to upgrade them digitally. Enterprises competing in the digital marketplace are looking at technologies that enable fast and reliable access to applications and critical resources for all users. As such, enterprises are now modernising their networks with the deployment of software-defined wide area network (SD-WAN) and cloud solutions. SD-WAN uses centralised control to securely direct traffic across WAN, thereby increasing application performance, enhancing user experience and reducing IT-related costs for enterprises. Owing to these benefits, enterprises across the globe have started deploying SD-WAN to enhance their digital networking experience. Enterprises in India too are turning to SD-WAN solutions to enable their digital transformation. Meanwhile, the adoption of cloud computing has been increasing rapidly. Enterprises undergoing digital transformation are among the leading contributors to the public cloud demand.
A look at some of the key adoption trends of SD-WAN and cloud solutions, key initiatives and partnerships in this space, and the way forward…
Cloud adoption among enterprises
Market trends
As cloud ecosystems have matured, hybrid or multicloud environments have grown in popularity. A hybrid cloud offers greater flexibility to organisations by combining the advantages of private and public clouds. Further, as enterprises are enabling remote working for most employees, software-as-a-service (SaaS)-based applications and tools have seen a strong surge in their demand. The multicloud model is also emerging in the cloud market. According to industry experts, besides hybrid cloud models, the availability of the multicloud model is expected to see an uptick among large enterprise service providers. For instance, to offer greater cloud capacities and a range of services, major players in the industry such as AWS, Google, SAP and Microsoft have entered into several multicloud partnerships. This has created collaboration among businesses, that are focused on organising and sharing data among their own partners with different applications. Another key trend emerging in the cloud ecosystem is virtual cloud desktops, also known as desktop-as-a-service (DaaS). The software requirements on a virtual cloud desktop are fully managed by cloud service providers. The DaaS model eliminates costs associated with acquiring new hardware, or updating existing ones. Moreover, this model increases efficiency across the workforce by ensuring up-to-date and synchronised technologies for users.
Adoption trends
Although the Covid-19 pandemic altered many paradigms of conducting business, business growth and transformation continue to be the top drivers for cloud adoption. Cloud also played an integral role in helping enterprises sustain themselves despite lockdown scenarios and IT infrastructure inconsistencies, enabling them to innovate faster, thereby enhancing speed to market, agility and responsiveness. As per this year’s EY-NASSCOM cloud survey, while 67 per cent of the large enterprises have accelerated cloud adoption, 39 per cent of medium-sized companies and 38 per cent of small companies have embarked on their cloud journey. However, 92 per cent of small enterprises and 80 per cent of medium enterprises are facing gaps in managing security-related risks. To address the acute shortage of digital talent, organisations are focusing on new talent acquisition efforts (73 per cent) and automation initiatives (66 per cent).
The survey also threw light on the core benefits of cloud adoption such as the amount of flexibility it offers when it comes to different aspects of cost, allowing organisations to explore multiple strategic options. The different cloud models and cloud service options are not only offering organisations the option to implement cloud in different ways, but are also enabling them to plan their technology budgets.
Key initiatives and collaboration
Recently, in March 2022, Google Cloud and Flipkart entered into a multiyear strategic partnership to help fast-track Flipkart’s innovation and cloud strategy. This partnership will propel Flipkart into its next phase of growth and advance its vision of onboarding India’s next 200 million shoppers and several thousand sellers. Around the same time, the Mahindra Group and Google Cloud announced a new collaboration that will power the group’s digital transformation strategy and fuel its next phase of business growth.
The Mahindra Group’s Digital, Data and Cloud Center of Excellence, referred to as Mahindra Digital Engine (MDE), will use Google Cloud’s secure and reliable infrastructure and advanced data analytics technology to drive innovation across the group’s multiple business units, including its core operations, customer-facing channels, and employee experience. The partnership will also embed an agile culture within MDE that will foster innovation, embrace change and build capabilities by cultivating the right talent.
Prior to this, in January 2022, NxtGen had offered enterprise cloud services (ECS) to PeopleStrong, Asia’s leading SaaS-based HR technology company, and helped them set up their entire user acceptance testing. NxtGen provided a reliable solution for absorbing newer technologies to the HR technology company to increase its scalability.
SD-WAN adoption among enterprises
Modernising the WAN infrastructure has become unavoidable. By embracing SD-WAN, enterprises can make it easy to adopt connectivity solutions that are programmable, scalable, automated and affordable. This will also aid in extracting more meaningful returns from cloud investments, and is an essential component for empowering the remote workforce to remain highly productive and ensure a good end-user experience.
Adoption trends
In terms of sectors that will be leaders in SD-WAN adoption, industries with branch-heavy networks and distributed users or a remote workforce will be early adopters of the technology. Industries such as financial services, retail, manufacturing and energy are expecting to lead the adoption of SD-WAN solutions. However, as per industry experts, healthcare will demonstrate the fastest growth rate for SD-WAN in the immediate future.
Geographically speaking, North America has the largest share (45 per cent) of the SD-WAN market while Europe holds a 29 per cent share. In comparison, the adoption of SD-WAN in the Asia-Pacific region has been lower, barring a few advanced countries such as Japan and Australia. Enterprises in the Indian market too are rapidly moving towards SD-WAN owing to several factors such as increase in fibre deployments, which has led to a significant enhancement of home broadband speeds; increase in cloud adoption; improvement in network reliability; and a greater focus on security needs. These factors have complicated the nature of applications that run on home routers, prompting enterprises to adopt SD-WAN solutions. In a recent report titled “Secure SD-WAN: The Launch Pad into the Cloud”, Barracuda Networks found that a fully integrated, secure SD-WAN is the preferred technology solution for 90 per cent of organisations in India. The report further explains that SD-WAN can help overcome the top two security challenges for enterprises with regard to public cloud – lack of access control and backhauling traffic.
Key initiatives and collaboration
In July 2021, Bharti Airtel announced the launch of advanced connectivity solutions for enterprises based on Cisco SD-WAN technology. The solution enables businesses, large and small, to accelerate digital transformation for their customers and allow organisations to deliver applications to users with greater visibility, security and performance. It allows enterprises to design, deploy, configure, migrate and manage their WAN infrastructure while rapidly adapting to the real-time demands of their cloud computing, mobility, and digitisation initiatives.
Meanwhile, in August 2021, Tata Teleservices launched SD-WAN iFLX, built on the Fortinet Secure SD-WAN solution. SD-WAN iFLX is a comprehensive solution designed to provide an enterprise with a highly flexible network to handle today’s complex digital and cloud applications, across all its locations. SD-WAN iFLX provides operational simplicity, application-level prioritisation and visibility, integrated security, an enhanced overall business application environment as well as much-needed resilience at an affordable price point. Moreover, in November 2021, Hughes Communications India Private Limited was awarded a managed network services contract from a leading oil and gas company. Under the contract, Hughes will deploy the Hughes ON SD-WAN solution at 250 dealer sites across India, using the best available broadband at each location, spanning DSL, cable, 4G wireless and satellite connectivity. Across the various access types, the managed SD-WAN deployment will deliver a consistent and secure user experience with built-in security and centralised management and control to enable applications such as customer Wi-Fi, point-of-sale transactions, digital signage and data analytics.
The way forward
Going forward, the adoption of SD-WAN and cloud solutions is expected to increase at a rapid pace as more enterprises look to implement a distributed workforce model. In this regard, the technology will become particularly important for IT personnel, corporate strategy and real estate planning as businesses start prioritising setting up small micro-offices as opposed to one large campus post the pandemic. Moreover, the onset of the 5G revolution in India would push enterprises to move towards more intelligent, robust and flexible network solutions such as SD-WAN, which are capable of coping with the agility and velocity of dynamic and hybrid IT environments.
Meanwhile, the cloud market is expected to grow exponentially in the aftermath of Covid-19. This growth will be largely driven by factors such as rise in demand for cloud-based business continuity tools and services, and suitability of the public cloud environment for the current unprecedented scenario. In addition, the need to support the remote workforce has boosted the demand growth.
In the aftermath of Covid-19, Gartner predicts that the proportion of IT spending that is shifting to the cloud will increase. Cloud is projected to make up 14.2 per cent of the total global enterprise IT spending market in 2024, up from 9.1 per cent in 2020. In fact, almost 70 per cent of organisations using cloud services at present plan to increase their cloud spending in the wake of the disruption caused by the pandemic.
