Dell’Oro Group sees SSE Surge, SD-WAN slowdown

Dell’Oro Group expects enterprises will continue to prioritize the security side of secure access service edge (SASE), but “slow down the networking side as the economic pressure increases,” according to Research Director Mauricio Sanchez.

While the SD-WAN market should expect continued growth this year, its rate of growth has slowed since high demand in the depths of the COVID-19 pandemic, and will start to experience “some level of modulation,” Sanchez explained.

He also noted that the spike in demand during that time has left vendors still dealing with backlogs, which might be acting as a buffer in preserving the rate of growth for the SD-WAN market.

By contrast, Dell’Oro Group foresees the security side of SASE, security service edge (SSE), will post another year of solid growth in 2023. Enterprises are “still chasing to ensure that they’ve got the best position for the security implications of hybrid work,” Sanchez said, adding “a lot of enterprises are still a bit behind.”

As enterprises tightening their belts will prioritize SSE over the need to invest aggressively on the networking side, “the savvy vendor will play both cards,” he said.

This means SD-WAN vendors without SSE capabilities will have to partner with security vendors more aggressively, and vendors with security and networking capabilities will “gravitate toward accentuating the security side.”

“I do see the need for the SD-WAN vendors to up their security game as table stakes to ensure that they take their share of the SD-WAN opportunity,” Sanchez said. sdxcentral