Infonetics: SDN, NFV Market to Exceed $11 Billion by 2018

The software-defined networking (SDN) and network functions virtualization (NFV) markets are expected to exceed $11 billion by 2018, according to a recent study from Infonetics Research, marking a colossal increase from last year’s less than $500 million in growth, according to the company.

The research firm outlined the predicted explosion of the SDN and NFV markets in its Carrier SDN and NFV Hardware and Software market size and forecast report, which it released in November. The report tracked the progression of the SDN and NFV markets across several areas, including SDN router and switch hardware and software and NFV categories such as virtualized network functions and deep packet inspection, according to the announcement.

“For three years, the telecom industry has been abuzz over SDN and NFV, with anticipation and hard work developing the vision, goals, architectures, use cases, proof-of-concept projects, field trials and even some commercial deployments,” said Michael Howard, Infonetics Research’s co-founder and principal analyst for Carrier Networks, in a statement. “We’ve been gathering data in this early market for nearly two years and are projecting the global service provider SDN and NFV market to reach $11 billion in 2018.”

You’ll have to shell out some cash to see the full results of the survey, but here are some highlights:

SDN technology allows network administrators to decouple control from hardware, while NFV replaces dedicated network appliances such as routers and firewalls with software running on standard servers. Several of the biggest U.S. telecom providers, such as Verizon (VZ) and AT&T (T), have already begun to deploy SDN and NFV technologies on their networks, according to CRN.

A similar report from Rayno Media in May predicted the SDN market would generate more than $20 billion in value for the channel. Rayno’s study asserted that large-scale events such as mergers and IPOs would be some of the driving factors in the growth of the SDN space, with opportunities in the NFV space also showing potential for massive revenue. IDC also reports that the SDN market is expected to spike within the next several years, potentially leading to the creation of more than $8 billion in revenue by 2018. Although the exact numbers vary greatly, it’s clear SDN is destined to become one the biggest new forces in the IT market by the end of the decade.