For the third quarter of 2017, SD-WAN appliance and software revenue reached $116 million, up 2.8 times year-over-year, according to the Data Center Network Equipment market tracker early edition from IHS Markit. While VeloCloud led the SD-WAN market with 22 percent share of third quarter revenue, Aryaka was in second place with 18 percent, and Silver Peak rounded out the top three with 12 percent.
Last month, IHS Markit positioned Cisco and VMware in a “two-horse race” for the No. 1 SD-WAN vendor spot. But Cliff Grossner, senior research director at IHS, clarified that this was based on the market reach of these two companies — not on specific quarterly revenue numbers. Their market reach was projected based on their purchases of SD-WAN vendors, Viptela and VeloCloud, respectively. Also, the previous report was a biannual market tracker, and today’s numbers are specifically for the third quarter 2017.
Today’s numbers break out Cisco and Viptela because their merger had not yet occurred during the compilation. And VMware is not on the list because it has not yet acquired VeloCloud.
What stands out on today’s revenue rankings are the positions of Silver Peak and Aryaka.
Asked if the rise of these two vendors makes them the next acquisition targets, Grossner said, “I hate to predict acquisitions; it’s pretty nebulous. Aryaka has other components of the company that are not exactly like the others; it runs its own network. Silver Peak is a pure-play SD-WAN vendor. It definitely could be looked at as an acquisition target.”
Just today, Silver Peak announced it has surpassed 600 production customer deployments, spanning from small-to-mid-sized businesses to geographically distributed global enterprises and cloud service providers.
Versa Networks is notably absent from today’s rankings. Grossner said the vendor has asked to be lumped in “other” for the time being.