Most managed services providers aren't strangers to providing network services. But thanks to increased interest in software-defined wide area networks (SD-WANs) more innovation is now occurring at the edge of the network than at any time in the recent memory of most MSPs.
Historically, the branch office inside most organizations has been served by routers augmented by WAN optimization appliances and stateful firewalls. That approach, however, created something of a kludge at the edge of the network. IT organizations were happy to have somebody manage it all on their behalf. But the costs associated with managing each individual device using a command line interface (CLI) made it a challenge for MSPs to profitably deliver those services.
Now the race is on to consolidate routers, WAN optimization appliances, and stateful firewalls into a unified SD-WAN service that can be centrally managed from afar by an MSP. Instead of having to roll a truck to service each piece of networking gear, a SD-WAN exposes a set of programmable interfaces through which it can be remotely managed. It then becomes much simpler for MSPs to provide additional services such as backup and recovery or the management of digital signage solutions to remote offices that employ those SD-WANs.
At the WAN Summit conference this week, MSPs including Tata Communications, British Telecom, Global Capacity, and GTT touted the fact that SD-WANs were enabling them to provide customers with more bandwidth using business-class Internet connections for the same flat price they have been charging for slower MPLS lines.
In some instances that means swapping out MPLS lines for Internet connections, but often it means creating a mesh network made up of both types of connections. In terms of consistent levels of performance and security, MPLS lines still have an edge over Internet connections that rely on a best effort method for sharing network packets. As a result, many organizations are implementing hybrid SD-WANs that allow them to dynamically switch connections between MPLS and Internet connections depending on the nature of the application. Instead of backing hauling all their network traffic through their data center, traffic that is ultimately destined for the cloud is routed directly from the remote office to the appropriate cloud service provider.
New skills needed to support new technology
That approach naturally creates a management challenge that pushes many of those organizations into the arms of an MSP. Because those SD-WANs provide a programmable means of managing those remote offices, the MSPs providing these services can now do so at a level of scale that's much more profitable.
Of course, delivering those services requires MSPs to have software expertise. The days when MSPs needed to dispatch router specialists to each remote location are mercifully coming to an end. In their stead, MSPs need software engineers with programming skills working in a network operations center (NOC).
Ciaran Roche, CTO for Coevolve, an IT consulting firm, told WAN Summit attendees that venture capitalists have poured $500 million into the SD-WAN space, and there are already 25 different vendors offering SD-WAN platforms. It’s too early to say which vendors will come out on top, but many of those startups are already encountering fierce levels of competition from incumbent providers of routers and WAN optimization appliances. MSPs obviously need to exercise some care when determining who among those vendors to partner with given the inevitable wave of mergers and acquisitions ahead. But no matter which vendors win that battle, SD-WANs have already become too big an opportunity for MSPs to ignore.