Why do we need SD-WAN solution?

According to IDC research, SD-WAN Infrastructure market is expected to reach $4.5 Billion in 2022. They expect an average 40.4% compound annual growth between 2017 and 2022. Several enterprises have started to slowly experiment with SD-WAN solutions. There is at least two dozen SD-WAN vendors around the globe. So, the fundamental question for Enterprises who are yet to switch to SD-WAN is "Why do we need SD-WAN solution"?

What are the problems that exist today?

1. Bandwidth Growth: Enterprises are witnessing an average 25% growth of bandwidth needs, year-on-year. As a result, they are paying a huge bill to service providers for their MPLS services (dedicated circuits connecting multiple enterprise locations / facilities). 
2. Service Activation Time: Today, service providers take anywhere from 30 days - 90 days to turn-on a MPLS service for a customer. The lead time to get a service is way too long for small and medium sized enterprises.
3. Manual Setup: Traditional MPLS networks are static in nature and requires a lot of manual setup procedure (Designing the network, high availability, technician dispatches, router service configuration etc.,). Imagine a large bank or a coffee shop that have to activate the MPLS service for several hundreds of their office locations.
4. Changing Customers' needs: Enterprises are migrating many of their services to the cloud. Most small/medium sized enterprises are subscribing to SaaS offerings. Such SaaS services are already providing security features. Small/Medium enterprises are just looking for an effective connectivity solution to the cloud. The number of business applications exchanging "sensitive" traffic between their office locations is minimal. Such applications don't demand a high cost MPLS service. 

What are some of the benefits offered by SD-WAN?

1. Cost Savings: SD-WAN vendors claim up to 90% cost savings by switching completely to SD-WAN based solution. However, Enterprises aren't ready to make the switch completely. Today, Enterprises operate SD-WAN solutions in conjunction with MPLS services. According to a recent study done by Masergy, they are able to save up to 40% costs, by adopting SD-WAN solutions. 
2. Quicker Service Activation: SD-WAN solutions are offered as Over-the-Top (OTT) services. Hence, the activation time is very short. You can turn-on the services in just a few hours - if you are using a solution that supports Zero Touch Activation. The long pole in the service activation cycle is the time it takes to ship a Customer Premise Equipment (CPE) device to the customer location. 
3. Ease of Traffic Management: SD-WAN solutions support features such as dynamic-routing - which enables the customers to decide how the traffic gets routed across different links, which traffic has to be prioritized/deprioritized etc., SD-WAN solutions also allow non-sensitive/non-critical business traffic to be offloaded locally to the Internet. For example, in a coffee shop, the visitors' Internet traffic can be offloaded locally and only the corporate traffic can be sent over the SD-WAN connection. 

SD-WAN technology is still in its early stages - it is still crawling - and would take a few more years to walk and run. Given that the service is offered over the top, there are still a lot of unanswered questions on SD-WAN security, quality of service and high-availability. (Read: Will 5G accelerate SD-WAN adoption?)