WAN Optimization: From Hype to Hero
WAN optimization solutions have rapidly moved from ‘hype’ to ‘hero’ in the last year as these tools have become the preferred choice for companies in optimizing bandwidth utilisation to support their regional expansion needs.
The explosion of corporate wide area networks (WANs) across Asia Pacific, as the region continues to be the growth hub for many, has left corporations reeling from often inadequate and costly bandwidth, particularly in developing economies, while needing to ensure reliable IT connectivity.
Arun Chandrasekaran, industry manager at Frost & Sullivan, said that network and application optimization is an inherent issue even in more advanced Asian nations. Even in countries where high bandwidth is cheaply and readily available, WAN optimization technologies are able to solve the issue of application latency that adding more bandwidth will simply not do.
According to new analysis from Frost & Sullivan, Asia-Pacific WAN optimization controller market grossed an estimated $246.8 million in 2008, growing 21% year-on-year. Growth is expected to decline to 13.3% in 2009 to close the year at revenues of US$279.6 million, before picking up again to grow 22.2% in 2010. Overall, a healthy CAGR (compound annual growth rate) of 19% is expected from 2009 to 2015, to reach a market size of $831.6 million by end-2015.
Deployments have largely been limited to larger businesses with greater financial muscle given the perceived high cost of WAN optimization technologies to budget-conscious small and medium enterprises (SMEs), more so in a recession-hit economy. Large enterprises accounted for 61.6% ($152 million) of the revenues in 2008 - a majority of these investments being at data centers and branch offices.
Chandrasekaran said that WAN optimization is the ideal technology for [large] businesses with wide regional presence and multiple office locations, running a host of business applications that support a mobile workforce. As businesses expand beyond their home borders, corporate WANs are no longer limited to bandwidth issues at country-level, but at regional level as well. WAN acceleration solutions enable companies to efficiently cope with varying bandwidth speeds, providing equitable access across the entire corporate WAN, regardless of branch office location.
The need to support enterprise applications, ensure delivery to remote endpoints and drive business synergies across the entire regional operations of an organisation have also led to the growing interest in WAN optimization solutions, to reduce the dependency on costly bandwidth acquisitions, he said.
In 2008, Australia led as the biggest spender on WAN optimization solutions, accounting for 24% ($59.2 million) of the revenues, followed by Japan at 22.8% ($56.3 million), China at about 10.1% ($24.8 million), and India at 7.2% ($17.9 million).
Chandrasekaran said that uptake among SMEs can be expected to rise as WAN optimization solutions mature in scalability, functionality and affordability, especially if the drive towards its integration with other security and networking solutions becomes a reality. The idea of managed WAN optimization services, which are said to be on the cards, will also drive SME adoption, as well as speed up the use of the technology in the fast-growing and geographically dispersed Southeast Asian nations, India and China.
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