Zscaler, Palo Alto Networks, Cisco Tops in SASE MarketZscaler, Palo Alto Networks, Cisco Tops in SASE Market

The global secure access service edge (SASE) market should reach $17 billion by 2029, according to Dell’Oro Group, which projects a 12% compound annual growth rate (CAGR).

Mauricio Sanchez, senior director of enterprise security and networking at Dell’Oro Group, said there is an increasing spending divergence between SASE’s SD-WAN (networking) and SSE (security) components.

Dell'Oro Group's Mauricio Sanchez

“Up until 2024, the growth on each side of the SASE coin had been robust and while not precisely equal, was comparable,” he said. “SSE continues to experience strong double-digit growth as enterprises accelerate cloud-centric security strategies. However, SD-WAN adoption has softened due to a combination of factors, including the correction in many hardware infrastructure markets (enterprises over-purchased during the pandemic), macroeconomic pressure (high inflation and interest rates for capex purchases), and a general maturing of the branch networking market.”

Additional Highlights From SASE Market Report

Additional highlights from Dell’Oro’s report include:

Related:CF20: 2024's Top SASE Providers You Should Know

The SASE market is not yet one size fits all, Sanchez said.

“What I see is that what customers want primarily depends on where they are on the SASE journey, which entails both IT organization and technological facets, and whether they are larger or smaller enterprises,” he said. “Thus far, most of the SASE uptake has been by larger enterprises with IT organizations with specialized and mature networking and security practices. They understand the transformation opportunities that SASE enables, want best-of-breed technologies and are willing to pay top dollar. For this class of customers, the conversation is about improving the SASE’s security and networking richness right now. They are interested in how SASE can be extended to solve some of the entrenched data security problems. They are keen to improve the integration and performance of SASE into the standing enterprise network.”

On the other side of the spectrum are smaller enterprises that don’t have the deep IT technical organization or the same budget capacity as their larger peers, Sanchez said. For them, technical time-to-value and business are key considerations, which means they want SASE solutions that are more straightforward and not science experiments. They also can’t blow the IT budget.

“For both classes of customers, building AI is a new enabler on both the capability and simplicity front,” he said. “AI can be used to improve the ability of SASE, whether for security (threat detection) or network (performance) use cases. Likewise, AI can enhance the simplicity of management through things like generative AI for policy management. As such, SASE remains highly competitive because of the diversity of customer requirements and innovation opportunities. Some vendors have won key battles, but no vendor can yet say they have won the SASE war.”

SASE Market Leaders

In terms of revenue share, Zscaler, Cisco and Palo Alto Networks are the top three in SASE, Sanchez said.

“Yes, M&A did shake up the competitive landscape for the No. 3 position last year after Broadcom purchased VMware,” he said. “VMware had SD-WAN but a small SSE, and together with Broadcom/Symantec SSE (which previously had no SD-WAN), it has become a tight fight between Palo Alto Networks and Broadcom for the third revenue position. On the opposite end of the spectrum are smaller networking and security players that have merged over the period I’ve been covering the market in search of an increasing share of customer wallets. For example, Aryaka (networking) and Secucloud (security), HPE (networking) and Axis Security (security), Ericsson/Cradlepoint and Ericom (security), and Check Point Software Technologies (traditional network security) and Perimeter 81 (Networking/SSE).”