WAN optimization has been around for years, but where it was initially developed to improve the performance of applications accessed across a wide area network (WAN), primarily from the data center to branch or remote offices, increasingly it is showing up in data center-to-data center applications. And what was once largely a market dominated by hardware, there is now growing adoption of virtual WAN optimization controllers (vWOCs).
According to Dell’Oro Group, the WAN optimization market is forecast to exceed $1.5 billion in 2016. During the same timeframe, the related Application Delivery Controller (ADC) market is expected to exceed $2 billion, with both segments driven primarily by the evolution of the data center, led by cloud and virtualization. The report also indicates that in each market, virtual appliances will steadily build larger shares during each year of the forecast period.
At the end of January, Gartner released the fifth iteration of its WAN optimization controller (WOC) Magic Quadrant, identifying the top seven vendors, which it defined as those with worldwide 2010 WOC revenue exceeding $20 million. Riverbed Technology, which reportedly accounts for more than half of the WAN optimization market, and more than twice the share of its closest competitor, is atop the leader’s quadrant, trailed by Silver Peak and Blue Coat Systems. Cisco is alone in the challenger’s quadrant; Citrix and Ipanema are in the visionary quadrant; and Circadence and F5 are in the niche quadrant.
When you add in application optimization, a number of new vendors must be considered. In March, Gartner said end-user spending for application acceleration equipment contracted 0.5% to $844.8 million in 4Q11 compared with 3Q11, but overall spending grew 10.8% last year. While Riverbed extended its lead in the WOC market, F5 increased its share in ADCs.
The 2011 data center network equipment market, which includes WOCs and ADCs, was up 9% (to $8.4 billion), states Infonetics Research. This is down compared to the 59% surge in 2010. It will experience double-digit growth for the next two years. According to the research company, F5 outperformed the market, growing its ADC revenues 20%. The competition includes Brocade, Cisco, Citrix and Radware.
As the numbers would indicate, in a trillion-dollar IT market, the WOC/ADC segment is still relatively small. Gartner says the market is still far from saturated as the technology has typically been deployed to target trouble spots, rather than optimizing networking at all corporate locations. As cost of bandwidth and quality of service (QoS) are joined by the likes of virtualization and new application environments such as cloud computing and Web services, this segment will increase in size and significance.
With demand growing for a more agile IT infrastructure, WAN optimization solutions will take on an expanded role to facilitate this transformation, writes analyst Bob Laliberte, Enterprise Strategy Group. In a white paper commissioned by Blue Coat, he identified the rapid adoption of cloud and Software-as-a-Service (SaaS) models, along with the continued data center consolidation. All three are top-ten IT initiatives for 2012, as organizations strive to reduce operating costs, says ESG.
According to Laliberte, “Consolidating data centers and the applications contained within enables businesses to reduce software license and maintenance fees and limit power and cooling requirements. Ensuring the right network performance and availability demands adequate connectivity between all remote sites and consolidated data centers, and also between data centers themselves.”
Video is also a growing concern as it becomes more pervasive in the enterprise, writes Laliberte. “Organizations are leveraging video as a vehicle for communications, training, and education. The challenge is that video need to be distributed within and outside the enterprise. In fact, 30% of respondents to a recent ESG survey reported challenges in delivering latency-sensitive applications like VOIP and video.”
Desktop virtualization (VDI) has not taken off as many pundits have predicted, but nobody doubts it is coming. ESG says it is being driven by the success of server virtualization and increased use of personal devices, smart phones, or tablet computers in the workplace, especially in verticals like health care. Laliberte adds, “This technology eliminates the need to procure, manage, and secure physical laptops and desktops, but in doing so, it shifts that burden to data center-resident servers, storage, and networks—and makes the WAN more crucial for the delivery of virtualized desktops in remote locations.”
All in all, we’re in for interesting times as new technologies, applications and solutions reshape the WOC/ADC market. As the saying goes, change will be the only constant.