Gartner’s 2022 SD-WAN Magic Quadrant report identified Cisco, Fortinet, VMware, Palo Alto Networks, Hewlett Packard Enterprise (HPE) Aruba, and Versa Networks as market leaders. The analyst firm estimates the top 10 vendors make up over 80% of the market.

To determine SD-WAN leaders, Gartner reviews vendors’ product capabilities such as the ability to operate as a branch office router, and having a centralized management for devices, zero-touch configuration, and VPN with a basic firewall. The analyst firm also reviews vendors’ business and financial performance based on their volume of customers, sites, and contracts.

Senior Director Analyst Jonathan Forest told SDxCentral there are 13 categories that are evaluated for the Magic Quadrant, and it's the culmination of all these categories that determine leaders, challengers, visionaries, and niche players in the market.

“Fundamentally, a leader is one who's got a complete product that serves across various market segments, a vendor who's going to be able to address the majority of customer needs well, and also has the product to do it,” Forest said. 

Huawei was identified as a market challenger – a vendor that has demonstrated sustained execution in the SD-WAN market with clear, long-term viability but has not shown the ability to “drive, shape and transform the market.”

Juniper Networks was positioned as the only visionary on this year's chart. Gartner said although visionaries often help transform the market, from driving new ideas to solving enterprise challenges, they “typically lack market share, global coverage and/or complete product capabilities to address most use cases.”

Forest advised being “very careful” when it comes to underestimating the market’s niche players. Gartner’s niche players this year included Cradlepoint, Barracuda, Forcepoint, Nuage Networks, Citrix, and Peplink.

Forest noted that while the smaller players have limitations such as geographic reach and limited market share, many of these vendors have customers who look for “specific requirements, use cases, technology, vertical focus, whatever it happens to be, that are aligned with what that vendor is trying to achieve.”

“This market is dominated at the high end by a handful of vendors, but it's got a long tail,” Forest said. “Niche players are very valuable competitors in this market.” 

By Gartner’s projections, the SD-WAN market will grow upwards of 14% compound annual growth rate for the next four or five years. “I would say there's growth opportunities for every vendor, not just the leaders,” Forest said. 

The market is “mainstream and maturing,” according to Gartner. With around 70 suppliers, the analyst firm said the SD-WAN market’s supply side remains a crowded landscape, with large established vendors and smaller providers from multiple segments competing for market share.

“There's a lot of vendors in this space. So it's still quite fragmented, even though it's becoming more and more top heavy,” Forest said. 

Forest added the market has seen and is expected to see more mergers and acquisitions (M&A) activity in the near future, with Gartner clarifying “acquisitions may come in the form of small vendors combining to achieve scale, vendors looking to enter the space, and continued consolidation among networking and security vendors.”

“As we look out three years, more than 10 mainstream suppliers are likely to remain, but we do see increasing separation by the top six or eight vendors from the rest of the market,” the firm said. 

Forest anticipates most M&A activity will happen between networking and security vendors, as the market strategically moves toward secure access service edge (SASE) -- or the convergence of networking and security. 

Recent M&A activity in this space includes Extreme Networks buying Ipanema (previously owned by Infovista), the announcement of Broadcom’s intent to acquire VMware, KKR’s completed acquisition of Barracuda from Thoma Bravo, Netskope’s announced acquisition of Infiot, and the announcement of affiliates of Vista Equity Partners’ intent to purchase Citrix.