Comms Business Live S4Ep2
DAVID DUNGAY [00:01:17] Welcome to Comms Business Live. My name is David Dungay editor of Comms Business magazine. And today we’re here to talk about SD-Wan and the opportunity for channel partners. Are we all excited? I am excited, I’m very excited. Apologies for being a few minutes late there we had a few technical issues. If you have any questions from my panel, I’ll introduce in a second. Please tweet those questions with the hashtag CB Live 19 that’s CB Live 19. Right. Some introductions from my right to my left. Anthony Senter, Adrian Tate and Tony Randall. Welcome to the show. Tell us who you are, who you work for. Anthony.
ANTHONY SENTER [00:01:54] Excellent. Hi, everyone. I’m Anthony Senter. I’m the managing director of SD-Wan Solutions. And that’s pretty much what we do. We offer complete software as a service SD-Wan solutions both for the channel and for direct. Direct is a complete solution for the channel really depends on who the channel is and which portions they want from us. But that’s that’s pretty much myself in a nutshell.
DAVID DUNGAY [00:02:18] Adrian.
ADRIAN TATE [00:02:19] Yeah, thank you, David. So my name is Adrian Tate. I’m responsible for the EMEA business for Talari Networks, which is now part of Oracle. We were acquired by Oracle at the end of November. So we are a vendor of SD-Wan Solutions.
TONY RANDALL [00:02:35] And I’m Tony Randall. I am the global director for SD-Wan Solutions to Westcon Com Store. We’re a distributor based in 75 plus countries and we ship into 180. We’ve really in the last two years built a SD-Wan practice as a strategic priority.
DAVID DUNGAY [00:02:55] Okay, so SD-Wan the analysts are predicting anywhere between 4 and 8 billion is quite a wide range there of a market opportunity by 2023. I want to know, what are you seeing out there today? Adrian, what what are you seeing?
ADRIAN TATE [00:03:12] So, yeah, actually, I’ve heard 8 billion by 2021. So I think we’re talking about over the next three years something quite significant in an explosion in the growth of that market. What am I seeing? Well, I would say that over in the US, our parent company, and I’m thinking really of Talari networks prior to the Oracle acquisition. I would say they’ve crossed the chasm now. We’ve certainly gone from early adopter phase into mainstream in the United States. What I’ve experience here in EMEA over the last 12 months would suggest that we’re still slightly behind. So there’s a lot of research that has a lot of chats about SD-Wan at Talari we’ve been having lots of conversations. But I’d say most people are at POC or maybe initial pilot phase than not so many just yet have started to roll out to their full enterprise.
ANTHONY SENTER [00:04:07] It’s funny. I think those that know me know that I love a couple of stats and they’re really so interesting. Way back in 2016, only 1 percent of organizations that was had actually implemented SD-Wan by 2018 that was 10 percent and a further 85 percent of organizations was actually looking into SD-Wan now two months into 2019 and that’s already grown to 93 percent of all organizations are looking into SD-Wan they know, they know they know SD-Wan is the future and they’re keen to find out what it is. And it’s kind of our job to make sure that we can deliver on proper SD-Wan for them.
DAVID DUNGAY [00:04:43] Sure interesting that you mentioned that lag between Europe, United States, perhaps the states a little bit ahead of us. I mean, how how far ahead would you say that is in twelve months, 18 months? What are we talking?
ADRIAN TATE [00:04:56] I’d say at least 18 to 24 months. In my experience, that’s not just in the SD-Wan market place, but just across the software industry, traditionally it seems to have taken a bit longer for the UK and EMEA to to sort of dip their toe in the water with new technologies. So, you know, there’s perhaps a little bit of scepticism out there. The I.T. industry comes out with new topics and buzz phrases regularly and it can be a bit overhyped. But yeah, there’s this significant value in SD-Wan I’m sure we’ll talk about that around this table over the course next half hour. But yeah, I’d like to think that as we go through this year, we will certainly be seeing quite a significant upturn in the revenue coming through the Oracle Communications Group, which is where Talari now sits because we’ve got much more market presence and reach for to be to enable us to do that. And I think then the next two years of that will be just a roller coaster ride.
DAVID DUNGAY [00:05:56] Okay. And Tony, from a distribution side, what are you what are you seeing out there?
TONY RANDALL [00:06:01] Well, what I’m seeing is that the customers I talked to and I talk to different types of shapes and sizes of customers, whether they’re small resellers, whether they’re end customers or whether they’re a big service providers. And they’re all on the journey now. They’re all actually looking now at SD-Wan for a number of reasons, as you say, we’ll probably go into them later. But in terms of our business, we’ve really seen a real take up, you know, growing really fast rate now. And I think there’s a lot of disruptive influences in the market at the moment. So there’s the vendors competing with each other. There’s the hardware side with with different options there. The resellers also are looking at provide the resellers, managed service providers. They’re looking at competing with service providers as well. So there’s all these dynamics happening at the same time, which makes it really exciting, I think.
ANTHONY SENTER [00:07:00] Yeah, I think just to sum it up really quickly, it’s it’s it’s not a case of SD-Wan but SD when you know, you are going to do it.
DAVID DUNGAY [00:07:07] SD when, I see how you’ve done that.
ANTHONY SENTER [00:07:09] Absolutely. I had to get that in.
DAVID DUNGAY [00:07:11] Fair enough Okay. So we’ve mentioned, you know, it’s been a bit of a buzzword for a while out there in the markets and there was a period where I felt like everyone was slapping and SD-Wan label on just about everything and anything. So let’s clear up a bit of that confusion to start with. What actually constitutes SD-Wan. Anthony you wrote quite a nice piece to me back at the end of last year. Lets start with you on that.
ANTHONY SENTER [00:07:39] I don’t want to go off and mumble a whole load of words, so that’s probably just, just going to make me look silly about it. Gardner originally released for properties that made an SD-Wan and yep, fair enough, it did narrow things down. Now the Metro Ethernet Foundation is releasing another four to go with that. So they’ve actually got eight properties of SD-Wan and that’s going to nail down the market a little bit more so that the chaps out there who maybe have slapped an SD-Wan label on a load balancer, they’re not going to quite cut it as soon as these new guidelines come out. As to what SD-Wan is. They’re more restrictive than they were. But it hasn’t nailed SD-Wan down as it should be. So I’m a true advocate that SD-Wan must be a proper and a true SD-Wan it has to do all these different things that makes it an SD-Wan and there’s only a handful of suppliers out there that can actually do that. And those are the ones that I’m firmly putting my money against. And it’s guys like Talari it’s guys like Silverpeak Velocloud. The true pure play SD-Wan providers, not someone who just has a load balancer or, you know, kit like that. That’s that’s my opinion.
DAVID DUNGAY [00:08:49] Adrian, do you agree with that? Are you a purist to say.
ADRIAN TATE [00:08:54] Not entirely a purist. I don’t look in detail into the eight characteristics that Anthony talked about. You know, I’d base it on what I hear from customers when I’m out there speaking with them. I’d say the first reason that people are looking at SD-Wan is its cost savings. People seem to think that that’s what SD-Wan is moving from more expensive communications connectivity to cheaper communications connectivity. So going from MPLS, for instance, over to Internet and accessing cloud. And and, you know, a lot of people think that that is what SD-Wan is just moving into the Internet and cloud world. But there is a lot more to it, as Anthony says, a lot more things. But you at my level, on the sales side, we need to keep it simple. We need to keep it business focussed and talking about the value that it’s going to bring to the business, because not every business is going to see cost savings out of SD-Wan.
DAVID DUNGAY [00:09:51] So that’s an interesting one. Anthony, I think you mentioned sort of that 95 percent of businesses are looking at.
ANTHONY SENTER [00:09:56] 93.
DAVID DUNGAY [00:09:57] 93 percent not far out of looking at SD-Wan currently. It’s not all about cost savings. What are what are the major benefits a customer should be looking at in order to sort transition to this technology. Tony.
TONY RANDALL [00:10:09] So well we’re actually a user of SD-Wan ourselves went through a long, our IT side went through a long evaluation, tested it, benchmarked it, and I think some of the feedback I’ve got from our I.T. team, you know, gives us examples of what SD-Wan is for us and for us, it as a user of it. It’s about application performance. So making sure that your key critical applications, which were unified comms and our ERP system, making sure those run on a consistent basis globally. I think it’s partly about capping investments. So it’s got to pay for itself and also visibility. That was a really key piece of feedback from our I.T. teams being able to see for the first time how applications were performing, decide how to prioritize them and really own the set up themselves rather than being reliant upon service provider,.
DAVID DUNGAY [00:11:08] I.T. teams all happy now.
TONY RANDALL [00:11:10] They are.
ANTHONY SENTER [00:11:11] I think it’s I think is really key to point out that there isn’t really a single SD-Wan flavour. So you can’t just go and say, I want an SD-Wan and that’s not going to solve your problems. They have all the different vendors have their very specific characteristics and they all fulfil a very specific need. So a SD-Wan solution from, say, for example, Talari might not be the best fit for someone down the road who has a completely different business model. So it’s just this there’s so many different choices out there that the channel has to be instrumental in guiding the customers towards which one is the correct solution for them.
DAVID DUNGAY [00:11:48] Okay. I do want to talk about the channel, surely, but we’ve got a Twitter question from Clint Fletcher. Thank you very much for watching, Clint. I hope you’re enjoying the show so far. The question is, does SD-Wan replace MPLS? Quite a common question. We heard a lot around that. Anthony, what’s your take?
ANTHONY SENTER [00:12:07] It really depends on what you want to use it for. So, yes, it can totally replace it or no, it can’t really depends on the performance that you need from from your network. What we’re seeing in the industry is a lot of customers are actually increasing the bandwidth on top of MPLS or having a hybrid MPLS and SD-Wan network seeing how that works. Perhaps smaller sites that don’t warrant an MPLS connection can be moved onto a pure SD-Wan, but it’s definitely a mix of what you’re trying to achieve and what you need and also your locations. Whether whether MPLS would give you the required latency, whether you can actually use different internet services together in an SD-Wan environment. So again, it’s very specific in what the customer wants.
DAVID DUNGAY [00:12:51] So common a common misconception perhaps that it’s an either or, Adrian.
ADRIAN TATE [00:12:57] I think I would agree that there is a misconception that it’s either or I really even go as far as to say it’s actually not the right question because in my opinion, MPLS and Internet are different sorts of transport or different circuits that you can have. And actually SD-Wan is the software layer above that that sits independently of that underlying connectivity and just sort of manages and controls and allows you to centrally configure whatever traffic is going over, whatever IP connectivity that you’ve got. So you that that’s how I see it is. It’s not about the underlying circuits. So it’s not MPLS or Internet or ADSL or LTE. It it’s really having that software there above it that does that central control and configuration.
DAVID DUNGAY [00:13:46] Okay. So let let’s talk channel partners and there’ll be a lot of partners out there looking at how they integrate this sort of technology into their current offering. And what kind of advice would you give those guys or girls out there looking at this technology and how they can perhaps get it into their own customer base?
TONY RANDALL [00:14:04] So I think what I’m seeing across across our customer base is that that this is a real channel opportunity. Pretty much all the vendors I work with have a channel strategy. So that’s their method to scale. And that really presents a lot of opportunities for for channel partners. At the end of the day, they own the customer they can provide the innovation, they’re close. They’re listening. They can they can create and innovate new services for for their end users. So, you know, seeing this really being as massive channel opportunity, some some channel partners that we sell to are very skilled and others aren’t. So it’s about getting the right mix of capability to deliver on what the customers need.
DAVID DUNGAY [00:14:55] Sure Anthony.
ANTHONY SENTER [00:14:56] I see a definite swing on how people are actually buying their comms and with SD-Wan being relatively new, but especially in the UK, you might find that some customers actually have more SD-Wan knowledge than some of the channel partners themselves. So it’s absolutely key to invest in the training and the education of educating yourself to be able to sell the SD-Wan products or to partner with someone that actually does that for you. So there’s there’s a definite swing from how people are buying their comms. In the olden days you’d go to a telco and you’d buy an MPLS network or resell an MPLS network and that would be it. Now it’s much more consultative. You actually have to consult. You have to actually find out what the customer needs. You have to source the connectivity is not just a tick box exercise anymore. We now have. I can’t believe I’m going to say this, but there’s a lot in the lot in the press about take back control and customers want to take back the control of their networks and they can. So SD-Wan enables you to be very modular in your approach and you can build your network specific to your requirements based on that. And that’s where the channel comes in. I believe that’s where the true value of the channel is, and that’s where channel can do things a lot better than the traditional telcos who have a single product to sell.
DAVID DUNGAY [00:16:12] As a channel partner who manages to get back those skill sets right within their own organisation. Suddenly, quite potentially a valuable commodity Adrian.
ADRIAN TATE [00:16:22] Yep, absolutely. I would say this should be music to channel partners ears because, you know, traditionally the the wide area network business has been so dominated by the large CSPs the big global organisations and customers have felt locked in and unable to to transition away from those contracts very easily at all. Now, suddenly, because we’ve divorced the the SD-Wan the software element from the underlying connectivity, you can be much more agnostic or a customer can be much more agnostic about where they put their SD-Wan business. Now, some of those customers are saying, well, we want to bring that in-house and all we really need is to find the right product buyer and we’ll manage it internally. But that I’m seeing in the marketplace that the majority of customers still over here in Europe want to have some sort of managed service, but not necessarily from their traditional outsourced Wan provider. They’re seeing this as an opportunity to go with smaller partner organisations who are specialist in specific SD-Wan solutions, who can offer a much more informal service, a much higher quality service, much more agile service. So I think for anybody out there who is in a channel partner organisation, small midsize, you know, Tier 2 rather than Tier 1, this is a great opportunity for them.
DAVID DUNGAY [00:17:48] OK, we’ve got another question from Twitter. Ali Zeera, thank you very much for watching. Hope you enjoyed the show. Would a rooted GRE tunnel not perform the same function as an SD-Wan box? Who wants to take that one.
ANTHONY SENTER [00:18:03] I’ll give it a go. Yes, I know. So. So basically. SD-Wan will build conduits from where it needs to go, however, there’s more to it than that. So you will it’s SD-Wan will be using several different sources of connectivity. So you have the resilience and the redundancy in that to build the underlying connectivity that the tunnel goes over. So in that sense, yes. And also the the true play SD-Wan providers will also do packet inspection or intelligent packet inspection and actually switch data between all of these connections to deliver it as quick as it can on the best and the optimal route.
TONY RANDALL [00:18:40] I think that the trouble with going down into individual technical. Can you do it with this or can you do that? Is it kind of misses the point. You’ve got a solution here with from SD-Wan vendors. That gives visibility to customers to actually, you know, self-administered their own network. Look at their applications, see what’s performing. What’s under the bonnet is getting into the wrong kind of discussion, I think.
DAVID DUNGAY [00:19:07] Okay. Right. A lot of transformational projects going on at the moment, although we’re hearing increasingly some are being delayed because of a I won’t say the B word. So how key is this technology going to be within those big transformational type projects where we’re seeing. Anthony.
ANTHONY SENTER [00:19:29] Again, I mean, it’s it’s all about cloud and I think SD-Wan is enabling access to the cloud. The quicker you can get to the cloud, the quicker and get to your applications from the cloud without calling all of your data to a through a data centre. The better for your business. And I believe that SD-Wan will enable transformational digital projects.
DAVID DUNGAY [00:19:48] Okay. And in terms of verticals, obviously cloud. It’s pretty broad across everything in the UK and globally. But are we seeing any verticals perhaps run with this SD-Wan technology more than others or some slightly ahead? What are you seeing Adrian?
ADRIAN TATE [00:20:06] Can I just come back to the previous point about the transformational side of things. That were you referring specifically to network transformation projects?
DAVID DUNGAY [00:20:12] No to digital transformation projects as businesses as a whole.
ADRIAN TATE [00:20:17] Right. Okay. Because certainly it’s a good time to consider SD-Wan is when you are going through that transformation. But I guess the reason I want to come back to the point is just to re-emphasize that you don’t need to because SD-Wan can just go in on top of your underlying connectivity. You don’t need this heavy forklift upgrade that you’ve traditionally required where you want to change out from one Wan outsource provided to another Wan outsource providers. So the beauty of SD-Wan is that it is nimble, it is agile. It can be put in at any point in time, either at the point of transformation project or any time in-between.
DAVID DUNGAY [00:20:54] From that sense, could it then be perhaps the catalyst for that transformation?
ADRIAN TATE [00:20:59] It could be. Yes. Anthony mentioned about cloud, I think I think cloud is the biggest driver behind this. You know, if organizations were just requiring access on premise to a data centre with applications still hosted there, then I don’t think we’d be having these conversations at all. But because so many organizations that I speak to have got this cloud first strategy and therefore you need the company needs to re architect what they doing with their network. And that’s the perfect time to bring SD-Wan to the party. Coming back to your other point about verticals. Yes. Everything really is driven by business value. And I mentioned earlier that it’s not just about cost savings. But clearly, if there is a hard dollar saving that comes with the project, it’s going to make that project move forward more quickly than if it’s much more soft savings and that can’t be monetized. So because of that, I see that organizations that have got a global presence that whose wide area network goes out to all corners of the world and therefore the costs associated with having MPLS connections up to the Middle East or out to the Far East or down into Latin America are much greater. So I’m seeing that that’s what’s driving it for those organizations is they can see cost savings because of the global nature of their business. Whereas for organizations that are much more national focussed, particularly here in the U.K. or just across Western Europe then then that financial element isn’t so stark. And they’ve got to try and monetize or at least come up with a good business proposition around the softer business drivers.
ANTHONY SENTER [00:22:45] Well, actually, just just a completely flipside to that argument. We’re also seeing that perhaps the smaller guys so the smaller customers, like maybe a chain of estate agents can now actually have decent connectivity like SD-Wan, where previously they couldn’t justify MPLS because of the cost they can now actually have SD-Wan and install SD-Wan as the smaller guys, the guys that don’t have that much budget. So franchisee retailers, hospitality, all of these guys can now embrace the technology that they need to get the application performance that they’re that they need to achieve without going down MPLS because SD-Wan is readily available to everyone and it doesn’t matter whether you’re a single site, you can get an SD-Wan benefit or you can get the benefits of SD-Wan from a single site if it’s engineered correctly all the way through to 10 sites, 20 sites, five sites, ten thousand sites. It really doesn’t matter. The technology lends itself to whatever you need it to do just the way that it’s engineered or designed.
DAVID DUNGAY [00:23:41] Well, what a brilliant driver for that sort of small and mid-market.
ANTHONY SENTER [00:23:45] Absolutely. Which is where the channel comes in again, because that’s a lot of the service of its channel business.
TONY RANDALL [00:23:50] Yeah, I was gonna say that I think the small. So although I work a lot with service providers that the big CSPs, I think it’s also very interesting what’s happening in the in this sort of SMB space. And that’s probably untapped I think by by vendors at the moment having a really automated solution that works down at the small level. But we’ve got customers who end customers who were retail stores and shops where they go live on 4G link. So they get two days notice. The device goes into the shop, it goes live on 4G. They then bring a broadband connection in after a couple of weeks when is provided that gets plugged in and automatically starts using that link and then MPLS comes along maybe a month or two later. So I think the point of that is it’s about the speed of deployment now being much, being able to do it much faster on a on a platform like this.
ADRIAN TATE [00:24:43] It’s interesting that you say MPLS comes along a month or two later, one of the things that I hear from CIOs is that MPLS is the time lag between ordering an MPLS connection and it actually being delivered and implemented can be three months. It could be six months. I’m even hearing horror stories at 12 months because sites can be.
TONY RANDALL [00:25:04] I was being generous to my customers.
ADRIAN TATE [00:25:07] Exactly. And that was going to be a point I was going to make. Is that where organizations can’t initially see that the cost savings from swapping over from MPLS to to some sort of broadband Internet. They certainly can see the business driver in the agility, the speed to market where they want to open up a new office. And traditionally, one of the first activities on the critical path has had to be, I must order that MPLS link because it could be six months before it actually arrives and is installed. So that is a huge business driver and usually that can be monetized. If we can open an office in one month or two months time rather than in six months time, then clearly there is a huge contribution to the bottom line of the organization.
DAVID DUNGAY [00:25:54] So we’re actually seeing some of those drivers coming directly from SMB type customers now, which is amazing really, because our channel channel audience thus that’s their that’s their sweet spot, really small, medium business. I mean, would your typical small, medium business really be that aware of this type of technology, though?
ANTHONY SENTER [00:26:15] Well, I I wouldn’t think so. I mean, SD-Wan is not really a buzzword that you would hear unless you were in the industry. And that’s, again, where the channel needs to come, because the channel is is close to every one of these customers in some way. And it’s through through that that their customers will actually be able to benefit from from this and also introduce things like disaster recovery. So you might be a small office. You might have two or three offices, but if you lose one of your offices, that could be detrimental for your business. But with SD-Wan you can be up and running again instantly in a day or so with that, even if it’s on a 4G connection from somewhere else, as long as you have an SD-Wan device with some sort of SD-Wan connectivity or some sort of connectivity, you can operate your office from from from anywhere instantly almost. And that. I mean, that’s giving big business benefits to smaller guys, which is great.
DAVID DUNGAY [00:27:01] Okay. Well, we’re getting quite near the end of our session today. So let’s let’s talk about expectations for the next twelve months. We said at the beginning we might we might be 18, 24 months sort of behind our US counterparts. What do you expect to get out the SD-Wan market in the U.K. over the next year, particularly, Adrian?
ADRIAN TATE [00:27:22] So, yes, clearly it’s going to grow. There’s massive growth there’s massive interest in it. But I do think it comes down to the channel because most of the SD-Wan vendors want to transact through channel partners. They don’t want to be going directly to the end customer because they don’t have the scale to do so. Yeah, maybe we do now we’re part of Oracle. We’ve got more scale, but nonetheless, our strategy is still to go through channel partners. What I think is really important, though, for the channel partners out there is that they need to be clear on what they want to do with SD-Wan solutions, because there’s so many options out there in terms of, you know, about 40 or 50 vendor solutions that could be could be selected. There’s over the top solutions. There’s enterprise solutions. There’s solutions bought through the CSP. So it’s really important for the channel organization to decide what exactly are we looking to achieve out of our SD-Wan capability. And then I would say do not spread your resources too thinly because customers are looking for expertise. And so they want that channel partners to come to them and say, look, we’ve looked at the market, we’ve pinned our colours to one or two solutions and we are experts in that we can deliver you a very cost effective managed service around that solution. That’s the one we recommend for you. I see too many people in the channel wanting to hedge their bets a bit and perhaps offer five or six solutions. But the message that sends to the end customer really is you’re just waiting to see which one the customer picks. And then you say, that’s fine, we can offer that. And I think that’s a dangerous road to go down. Customers are looking for expertise. They want to take offer that managed service out to the smaller channel partner. Now, not not just think that they’re just being sold, whatever the customer that partner thinks they want.
DAVID DUNGAY [00:29:10] Okay.
TONY RANDALL [00:29:11] So I think I think maybe two years ago, vendors were really working direct in a DIY model with with customers that’s really switched now that the vendors I speak to got more demand than they can satisfy. So it’s all about getting channel. The channel needs to be that scaling mechanism. So I think they’re going to be absolutely fundamental to how fast it does grow from our personal experience, it’s accelerating very rapidly, but I think it could actually go much faster in the next 12 months than it has in the last provided there were enough channel partners on board, trained and gffering value to their to their end customers.
DAVID DUNGAY [00:29:53] Okay. Anthony, what’s your what’s your expectation for the next year or so?
ANTHONY SENTER [00:29:58] Absolute, absolute, still massive growth. I said I think we’re doing the snowball, the hockey stick effect, whatever you want to call it. I think we’re right on the edge of that now in the UK. And I think everyone’s in agreement. We are going to see exponential growth within this area. And we have to be prepared for it. We have to be knowledgeable. We have to be educated. Trained. And if we’re not, we have to buddy up with someone who is who can help us get there to make sure that the customer gets what’s right for him, not just a solution that is offered.
DAVID DUNGAY [00:30:24] Well, I’d like to thank you all for joining me today. It’s been a really fascinating discussion. I think we’re gonna see a lot more around this area as we go through the year. I’m really excited about it. And I hope you are, too. Thank you very much for watching. You’ve been watching Comms Business Live. My name’s David Dungay. Tune in next time. Thank you very much.