SD-WAN Vendors On Consolidation: 'A Lot Of Us Are Here To Stay'

Consolidation Ahead?

As the software-defined WAN vendor landscape expands, channel partners are wondering about consolidation and where to place their bets.

The SD-WAN vendor landscape is still maturing with several startups rising to prominence over the past few years, including CloudGenix and VeloCloud. Networking vendors Riverbed and Cisco Systems, meanwhile, have been doubling down on their SD-WAN technologies through acquisitions in 2017. Riverbed said it acquired Xirrus in a move to deliver an "unmatched SD-WAN offering" to fuel growth in the growing market, while Cisco spent $610 million to buy startup Viptela to boost its own SD-WAN portfolio.

In a CRN roundtable discussion, leaders from SD-WAN superstars Cisco, VeloCloud, Talari Networks and Versa Networks weigh-in on potential market consolidation ahead.

Kelly Ahuja

Company: Versa Networks

Title: CEO

Clearly, every partner is worried about continuity, support, and consolidation – it’s a big partner concern. Most partners had diversity in their portfolio. They had a large incumbent and maybe a Viptela, and now that they're both one, we're getting more calls than we were before because now they're looking for diversity in that portfolio. So, you can't predict what happens to any business.

There is a concern that the channel partners are going to have to get over, which is, a lot of us are here to stay. A lot of us are here to build big businesses and successful businesses. So, they're going to have to rely on us and look at not just balance sheets, but the reference customers, the number of carriers, the number of large enterprises, to realize who is going to have that lasting power versus who is not.

Sanjay Uppal

Company: VeloCloud

Title: CEO and Co-founder

There will be some stratification. There are a few players that have raised the funds that are necessary to go out and be successful and have enough customers, because you need that customer traction to be able to grow on itself, just simply because of the land-expand model … We have about 1,000 enterprises and 50 service providers [customers]. I would like to think we're around to stay.

The market is also very large that it is going to accommodate more than one player. This is not a WAN optimization market by any stretch. This is at least 20 times the size if not more. So, it can accommodate many players. We all have somewhat different routes to market. But, will it accommodate all the players who claim to have SD-WAN? Probably not.

Ramesh Prabagaran

Company: Cisco

Title: Senior Director Product Management (formerly from Viptela)

Consolidation is something that's top of mind as a risky item for every one of the customers and partners out there. There are some that will sustain, and there are some even in this room here [Viptela, VeloCloud, CloudGenix, Silver Peak and Talari Networks] that will get consolidated. And so the partner absolutely has to ask that question.

Now certainly the opportunity I see with Viptela getting into Cisco is really that spread. You've got pretty much every single large channel partner out there, and at the same time they serve a pretty large portion of the market. So, that gives them a certain level of comfort.

John Dickey

Company: Talari Networks

Title: President, CTO and co-founder

There's this myth that everything consolidates to three players … but it doesn't always work that way. I think there are different approaches. So, you have a plethora of options there. The partner system worked with that plethora of options. I think we're somewhat like that. We have a different approach. We're all on the same panel and we all call it SD-WAN, but we all have different things that we do really well.

But I'll actually address the other side of that, which is the partner consolidation. And I think that's an interesting thing going on right now. An example is when Avnet and Tech Data got together. That was really a good thing for us, and it allows us to expand our opportunities faster because we're leveraging their center of excellence. So, I welcome those opportunities as I come.