For the networking industry — which can make glaciers look like Usain Bolt at work — Cisco’s ACI (Application Centric Infrastructure, AKA Software-Defined Networking) appears to be a runaway success. SDN is networking’s version of server virtualization… on steroids, and in the six quarters that Cisco has been selling ACI (as one of its three approaches to SDN), the company has raced to more than 5,000 Nexus 9K and ACI customers, 1,100-plus ACI customers (that’s more than 100 new customers since the end of October) and almost 50 ecosystem partners. Now the company, which has made a number of ACI announcements recently, is at it again, with a flurry of new enhancements, including beefed up security and Docker support.
The announcements will appeal to both N9K switch and non-N9K customers, as well as non-Cisco customers, especially those focused on cloud automation and security, said Srini Kotamraju, Director, Product Management, Cisco. Network automation is a huge opportunity, the company said.
“Customers tell me that only five to ten percent of their networks are automated today,” said Soni Jiandani, SVP at Cisco, in a prepared statement. “They are eager to adopt comprehensive automation for their networks and network services through a single pane of management, while improving security for east-west traffic, multi-cloud traffic and bare metal applications in a consistent manner.”
Cloud automation and security may be the low-hanging ACI/SDN fruit, but open source and containers are generating a lot of interest too, added Cisco’s Mike Cohen, Director, Product Management. “We are seeing a pretty strong shift by customers interested in open source… (and) containers”.
The datacenter and enterprise “In-Use” SDN market is expected to hit $1.4 billion this year, almost double last year’s numbers. “New SDN use cases continue to emerge, and the first half of 2015 was no exception with the establishment of the software-defined enterprise WAN (SD-WAN) market,” said Cliff Grossner, Ph.D., research director for data center, cloud and SDN at IHS. “The data center and enterprise LAN SDN market will be solidified by the end of 2016 as lab trials give way to live production deployments. And in 2017, SDN will move from early adopters into the hands of mainstream buyers,” he said.
While Cisco’s numbers appear to put it well ahead of its branded competition, i.e. VMware NSX, the IHS data for the first half of 2015 indicate why this market is so critical to proprietary networking’s 800-pound gorilla:
– bare metal switches accounted for 45% of global in-use SDN-capable Ethernet switch revenue;
-white box switch vendors, as a group, are #1 in bare metal switch revenue;
-Dell owns 100% of branded bare metal switch revenue;
-HP has the largest share of SDN-capable (in-use and not-in-use) branded Ethernet switch ports;
-in-use virtual switch (vSwitch) ports are expected to make up 11 percent of SDN (in-use and not-in-use) ports shipped by the end of 2015; and,
-SDN in-use physical Ethernet switches are forecast to comprise 15% of Ethernet switch market revenue in 2017, up from 4% today.
Speed, agility, automation, security, etc. are all good, but service providers, including telcos, are also expecting substantial savings with SDN. Most SPs surveyed (85%) expect datacenter network operating expenses (OPEX) to decrease significantly by the second year of SDN deployment. “CAPEX reductions are also expected, and respondents acknowledge they need to invest in equipment and operational processes to get started with SDN,” said Grossner,
In August Infonetics reported that carrier spending on SDN software, hardware and services is expected to grow from $103 million in 2014 to $5.7 billion in 2019. “We’re still early in the long-term, 10- to 15-year transformation of service provider networks to SDN,” said Michael Howard, senior research director for carrier networks at IHS.. “Momentum is strong, but we won’t see widespread commercial deployments where bigger parts of – let alone whole – networks are controlled by SDN until 2016 through 2020.”
In all, SDN and its SP/carrier sidekick NFV (Network Function Virtualization) are expected to be worth $45.13 billion by 2020, up from $2.02 billion this year. That’s a Compound Annual Growth Rate (CAGR) of 86.1%, and provides all the justification Cisco needs to keep on beating the SDN… excuse me, ACI… drum..
The Fiddly Bits:
Available today, Cisco announced APIC 1.2(1x) and NX-OS 11.2(1X), featuring:
-Multi-site app that enables policy-driven automation across multiple datacenters;
-Integration of Docker containers with the Cisco Application Policy Infrastructure Controller (APIC) to offer customers greater deployment flexibility;
-Support for automated service insertion for any layer 4..7 service (no device package needed); and,
-New support for cloud automation tools like VMware vRealize Automation and OpenStack including native OpFlex support with OVS.