SDN, NFV Markets Poised for Huge Revenue Gains in Next Five Years

By Steve Anderson December 08, 2015

More and more businesses are taking advantage of the benefits offered by software-defined networking (SDN) and network functions virtualization (NFV). Throw in the gains in the network virtualization market in general, and according to reports from, the stage is set for some major gains over the next five years.

The ReportsnReports report, titled “The SDN, NFV & Network Virtualization Ecosystem: 2015 – 2030 – Opportunities, Challenges, Strategies & Forecasts,” offers a clear look at the market's future growth as well as some potential pitfalls. Growth is clearly the focus here, as the projections suggest that investments in SDN and NFV are set to grow at a compound annual growth rate (CAGR) of 54 percent between now and 2020. By the end of 2020 alone, this is set to mean $20 billion in revenue for the market.

One of the biggest contributors to this huge number is the array of submarkets within the larger fields. Investments qualifying as part of the SDN, NFV, and network virtualization markets include customer premises equipment (CPE), mobile core, policy control, content delivery networks (CDN) and transport networks, among several others.

The report further noted that more than 70 percent of all virtual network function (VNF) investments could be traced back to one of a handful of key systems, including virtualized evolved packet core (EPC), IMS and policy control. There's also a clear separation in terms of SDN users; enterprise and data center users routinely use SDN, but service providers are only just starting to see the advantages of SDN in network use. In the end, orchestration platforms will prove a big spending point, with nearly $2 billion in revenue attributed to these just by 2020's end.

There's little doubt that this report spells opportunity, not just for orchestration platforms but for a host of areas beyond these services. NFV and SDN are markets just getting started in many ways, and a market currently on the ground floor means opportunity. What's more, this isn't likely to be a flash in the pan market, either, as there are plenty of clear examples afoot of how NFV and SDN have saved money. The ReportsnReports report will illustrate as much, and in general, it should be directive enough for anyone involved in the field to ramp up sales and marketing efforts. The iron looks about as hot as it can get; it's a great time to strike.

While not every firm here will be a winner—increased competition in this market will likely arrive and hurt the progress of some firms sufficiently to take such out entirely—there's a lot of room for gain. NFV and SDN will likely make big strides in the short term, and in just five years, we'll likely hear a lot more about this than we ever did.

Edited by Kyle Piscioniere

Contributing Writer

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