SD-WAN is a potential game-changer for wide area networking—on the same level as server virtualization, which transformed data centers over the last 10 years. SD-WAN combines the use of multiple active branch links, intelligent direction of traffic across those links, and centralized, policy-driven management of the WAN as a whole. The ability to leverage multiple lower-cost services (including Internet and 4G wireless) as well as traditional services like MPLS holds the promise of transforming IT’s relationship to the WAN and the WAN’s relationship to the business.

Transformational potential is not enough. IT has to build a compelling business case for making the transition. The base of the case must be cost. Nemertes has developed and validated an SD-WAN cost model that enables enterprise users to build that business case. The short version? SD-WAN deployments can cut millions from large WAN service bills. But connectivity is not the only avenue by which SDWAN can drive savings; by providing cheaper and more transparent and automatic failover when WAN links fail, SD-WAN can reduce branch WAN outages and troubleshooting costs by 90%.

The Issue
In the classic engineer’s formulation, “You can have it cheaper, faster, or better…pick two.” From time to time new technology comes along and, by changing the basic assumptions underlying existing solutions, manages to be cheaper and faster and better all at once.

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SD-WAN promises to hit the trifecta. By changing the underlying assumptions about how you connect a branch to the WAN (and, indeed, what constitutes a branch) it offers the chance of improving agility (i.e. being faster) and performance and reliability (i.e. being better) while also reducing costs.

What is SD-WAN?

Let’s start first with definitions. Software-Defined WAN, or SD-WAN, incorporates  several key concepts:

  • Abstraction of edge connectivity: Making all the connections into a location useful as a single pool of capacity available to all services.
  • Virtualization of the WAN: Overlaying one or more logical WANs on the pool of connectivity, with behavior and topology for each overlay WAN defined to suit the needs of specific types of network services, locations, or users.
  • Policy-driven, centralized management: Key to an SD- WAN is the ability to define behaviors for an overlay WAN and have them implemented across the entire infrastructure without requiring device-by-device configuration.
  • Flexible traffic management for performance and security: SD-WANs can optimize traffic in many ways; foremost, they can selectively route traffic across links based on criteria such as link performance.

The Nemertes SD-WAN Cost Model

The Nemertes model incorporates three key cost components of the WAN and of SDWAN solutions: connectivity, capital, and operations. It is built to support multiple  decision points in regards to each.

Cost Component: Connectivity
In assessing costs for any WAN architecture, circuit and service costs represent the overall lion’s share. And, as noted, the largest piece of cost savings from SD-WAN comes from changes in circuit and service costs. Whether overlay or in-net, the fundamental concept behind SD-WAN is to use any available network routes that deliver an application’s required quality of service; where big cheap Internet links are available, a lot of traffic will shift onto them off more expensive MPLS links, which can shrink or go away. This provides IT with a range of options for adding bandwidth, and lets network professionals take advantage of the full range of options to meet the needs of their particular mix of services, site types, and use cases.

Depending on the organization and its applications, that may mean:

  • Routing unified communications and other real-time traffic over MPLS while shifting other application traffic, file transfers, and other latency-insensitive applications to business or consumer Internet services (which cost up to 10 times less than comparable MPLS services) 
  • Routing all applications across MPLS where available, and using 4G wireless as backup or for overflow traffic 
  • Shifting all applications from MPLS to business or consumer Internet services to maximize cost savings, with a couple of providers per branch so the solution can still take advantage of differences in performance reaching various services across the vendors’ respective networks

So at the core of our cost model is the “circuit costs” component, which includes all services that an enterprise has in the “before SD-WAN” state and those it will have after deploying SD-WAN, including:

  • MPLS circuits: Traditional MPLS services with SLA and possibly multiple levels of QoS 
  • Business Internet: Internet services provided with an SLA and symmetrical service, i.e. the same bandwidth up to the Internet and down from it 
  • Consumer Internet: Consumer-grade Internet services (although also typically provided for smaller branch offices) which don’t have an SLA and may, if based on cable or DSL, be asymmetrical, with lower bandwidth for traffic going up to the Internet than for traffic coming down from it 
  • 4G or LTE wireless: Broadband wireless services usually used as initial connectivity in a new branch, or as backup or overflow capacity for an established branch with other connectivity available

Cost Component: Troubleshooting and Problem Resolution
Although they feel keenly the fact that they have too much to do and too little time in which to do it, network professionals usually don’t know exactly how much time they (and their teams) spend in troubleshooting and resolving WAN problems. That’s because teams typically wear multiple hats, and outages and issues occur relatively infrequently in most WANs.

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Over the course of a year, a network engineer might estimate she spends 75% of her time on upgrades and new installations; 10% of her time doing architecture and planning; and the remainder on troubleshooting. But unless the company she works for is exceptionally obsessive about time tracking, there’s no way she knows this. And when sites do experience significant connectivity issues, solving the problem is paramount and time-tracking what goes into it is not; resolution pushes aside normal work and often involves after-hours and weekend work that is rarely tracked and accounted for accurately.

Conclusion and Recommendations
SD-WAN combines active use of multiple branch links, intelligent direction of traffic across those links to provide better performance, security, and reliability, and centralized, policy-driven management of the WAN as a whole. It holds the promise of transforming IT’s relationship to the WAN by simplifying management of complex behaviors, promoting resilience and continuity of service, empowering more nimble branch strategies, and radically decreasing the cost of meeting rising bandwidth and performance needs. As always, IT has to build a compelling business case for making a transition like this, especially where an up-front investment will be required.

To read full download the whitepaper:
The CIO Guide to SD-WAN:Building the case for a faster, better, and cheaper network