Software-defined wide area networking (SD-WAN) revenue reached $444 million in 2017, according to the latest numbers from IHS Markit. For the fourth quarter 2017, SD-WAN appliance, control, and management software revenue reached $146.7 million.

VeloCloud led the SD-WAN market in Q4 2017 with 19 percent share of revenue. VMware completed its acquisition of VeloCloud in mid-December, but for IHS’ report it remains as a stand-alone company through the final quarter of 2017.

Aryaka claimed second place with 17 percent revenue share, and Silver Peak rounded out the top three with 12 percent share, according to the DC Network Equipment market tracker early edition from IHS Markit.

The report reflects the fact that Viptela has now been rolled into Cisco. One interesting change is that Riverbed moved up in its SD-WAN position from the third quarter to the fourth quarter 2017.

“Riverbed is starting to get more traction with their strategy,” said IHS Markit analyst Cliff Grossner. He’s referring to the fact that Riverbed started with WAN optimization and then tapped into SD-WAN. “Riverbed now has the large client base they can start to mine in a substantive way,” said Grossner. “We’ve seen Citrix do it and Silver Peak do it. There’s no reason Riverbed can’t do it.”

Cisco’s purchase of Viptela and the subsequent integration of Viptela’s SD-WAN technology seems to be a hit with customers. Didier Duriez, EVP for business global solutions at Orange, said this week that Orange was not especially happy with the Cisco IWAN platform it has been using for SD-WAN. But Orange is much happier with the Cisco-Viptela product.

For VMware, the company is already in the process of integrating VeloCloud with its NSX network virtualization platform. On its Q4 fiscal 2018 earnings call yesterday, VMware CEO Pat Gelsinger said, “We recently completed the acquisition of VeloCloud Networks. This extends our value in the enterprise and increases our relevance with service providers by offering end-to-end automation, application continuity, and security from data center to cloud to edge.”

“Overall, I think VMware coupling VeloCloud with NSX is a very good strategy,” said Grossner. “The one thing I think is still important as we look to the next phase for SD-WAN is going to be about the enterprise fabric for their multi-cloud.”

But does this mean the remaining SD-WAN startups will become irrelevant in the face of competition from Cisco and VMware?

“The enterprise WAN has always been sort of a separate market, so there’s still going to be a market where people will want SD-WAN solutions apart from all the other things they do,” said Grossner. “It’s a different buying pattern for the WAN.”