Forecasts for SD-WAN growth range anywhere from $2.5 billion to $8.05 billion by 2021 depending on who you listen to. Advances in networking have caused complexity and, in turn, driven demand for some form of an ‘as-a-Service’ model delivered via an external provider. Enter MSPs, stage left.
As the network essentially becomes flatter it becomes more viable for MSPs to set up virtual customer premise equipment (vCPE). Rather than selling customers IT equipment, the cost of the IT infrastructure is absorbed by the MSP. The customer pays to access that equipment as part of larger managed service. This vCPE segment of the services market is forecasted to experience a 46 percent compound annual growth rate through 2022 to reach a valuation north of $3 billion. But the best thing about that model from an MSP perspective is the number of application and security services that can be delivered going forward is almost infinitely extensible.
So far so good. But how will that opportunity present itself, and what must the channel do to be at the forefront?
To find out more about the barriers and drivers behind SD-WAN adoption, as well as the opportunities for the channel, we surveyed 410 IT and networking professionals in EMEA in late 2018. Initial signs were encouraging, with a quarter (26%) telling us that they already have SD-WAN and only 7% of respondents having no SD-WAN plans at all. That leaves a lot of people either deploying it in the next few months or considering it.
But - and this is a big but - while organisations are turning to SD-WAN, there’s a significant lack of education and skill to deploy and manage the technology across end-users in EMEA.
We don’t need no education
EMEA seems to be bottom of the list when it comes to education. Less than a third (32%) totally understand SD-WAN, behind the US (57%) and APAC (41%). Obviously this is based on people self-reporting their level of knowledge, so people could be downplaying their experience. Nonetheless it still points to an opportunity for MSPs and the channel to step in.
It requires a significant amount of programming expertise to manage SD-WAN deployments at scale. This, combined with the lack of education cited above, leads to an absence of internal skill and understanding around SD-WAN. This was highlighted by more than a third (34%) as the main issue following their deployment. For those who haven’t yet deployed the technology, a lack of internal skill is cited by three in ten (30%) as their biggest barrier, with a quarter (25%) not knowing enough about SD-WAN. The rate at which the necessary programming skills can be acquired by internal IT staff is constrained compared to the level of demand being generated for SD-WAN technologies. That gap creates a unique opportunity for MSPs to fill.
Poor vendor support is exacerbating the situation
Given that EMEA organisations themselves have a lack of SD-WAN expertise, training and knowledge, it’s unsurprising that they’d look to their vendor to offer this support. However, it seems like sometimes this gap isn’t being overcome. An issue cited by almost one in four of people who have deployed SD-WAN (24%) is poor vendor service and support. For channel partners, this is definitely worth taking into consideration when choosing which SD-WAN vendor to work with.
In terms of the SD-WAN magic formula then, what does a lack of end user education plus poor vendor support equal? Why, an opportunity for MSPs of course!
There are two main ways the channel can help here. The first is by offering training and consultancy around SD-WAN. After all, end users themselves think training is the key - almost two thirds (64%) believe there’s currently not enough SD-WAN training in their organisation and nine in ten think technical support and consultancy is important when looking for an SD-WAN solution.
So what can you do? Start by ensuring that your SD-WAN packages come with a high level of consultancy and support, and work closely with vendors to make this happen. How many partners out there are already offer SD-WAN training? This could be another revenue avenue to branch out into.
The second way the channel can help is by offering managed services. After all, almost half (47%) of SMEs use managed services to overcome internal skills shortages, according to our research to mark the inaugural MSP Day back in May. By offering managed SD-WAN, partners can offer end users all the benefits of leveraging the cloud-enabling technology, without any of the faff of managing it.
As we look to the future of SD-WAN, MSPs have an important role to play. We need to take responsibility as an industry to not only better educate and train organisations around SD-WAN, but also bridge the knowledge gap by offering a high level of support and consultancy around all SD-WAN solutions.