3 Ways the Channel Benefits From SD-WAN

IDC predicts that the SD-WAN market will be worth $6 billion by 2020, up from $225 million in 2015. That’s a tidy compound annual growth rate of more than 90 percent over the 2015-2020 forecast period. Drivers include a proliferation of SaaS-based business applications, such as Salesforce, Microsoft Skype for Business and Office 365, and demands for branch offices to directly, securely and reliably connect with HQ and access these and other services via the Internet.

What my company and other SD-WAN providers know, however, is that this growth can’t be realized without the channel. Partners not only have the customer relationships, they bring to the table invaluable skills — how to bundle various technologies, explain how an SD-WAN can deliver cost savings and improved performance, and determine the most effective way to route a traffic to and from remote locations over a customer’s hybrid private WAN and public Internet.

As enterprises seek networking infrastructure that can manage growing levels of in-house traffic going to the Internet, channel partners of all types are at the forefront of providing solutions. In fact, the number of channel partners offering SD-WAN is growing, according to Ted Corbett, an analyst with Gartner.

“There’s not a large number yet, but from a channel perspective, the more they think about it, the more they realize they need to do it,” Corbett said. “It has a cost benefit that is clear to every buyer.”

How can you make money with SD-WAN?

1. Map Out Customer Savings

With SD-WAN, customers can cap spending on expensive MPLS connections by leveraging broadband and other less expensive alternatives where possible, without affecting the performance of business-critical applications. In fact, less hairpinning of traffic can deliver better performance. Among the innovative SD-WAN features partners can leverage are traffic steering, with which you can dynamically send a company’s important traffic to the best performing circuits, while less critical traffic is throttled or sent to the less reliable circuit at any point in time.

Another benefit to customers is that they can move at a comfortable and personalized pace. SD-WAN can be rolled out gradually, so channel partners can ease businesses in slowly by introducing or taking advantage of hybrid network models prior to a full migration. The existing enterprise WAN can be augmented with less-expensive Internet circuits, such as cable connections, which are increasingly seen as business-ready.

2. Bundle Managed Services

Channel partners can benefit from the managed-service aspect of SD-WAN, according to Corbett. Implementing and managing an SD-WAN for customers adds “value” to the business relationship. Instead of a one-time sale, the channel partner is not only invoicing a monthly fee, but also acting as a direct provider of application performance. Channel partners can now provide wide-area networking in addition to value-added offerings through service insertion in the branch and in the cloud.

“It’s a stickier relationship,” Corbett said. “You always want to be more important in your customers’ eyes.”

3. Expand Your Customer Base

Transitioning to a recurring-revenue model means partners need to increase the number of customers they sell to, in order to maintain revenue. SD-WAN is a good entry point to gain new business. You can erase geographic boundaries, and even carriers and cloud providers can derive benefits by implementing SD-WAN in their cores by offering enhanced services such as better visibility, scalability, performance and control, leading to increased revenue opportunities. Verticals are also likely to be early adopters, says IDC.

SD-WAN is a transformational technology that promises to dramatically impact the entire enterprise networking ecosystem, bringing it into the cloud era of the future. The channel will play a major role during this exciting growth period.

Ron Longo is VP of Worldwide Sales at VeloCloud. Ron is a senior executive with more than 15 years of experience at major publicly traded companies, as well as at early-stage, privately held companies.