Software-Defined Wide Area Networking (SD-WAN) provides numerous cost benefits for businesses by optimizing network performance, improving bandwidth utilization, and reducing reliance on expensive legacy WAN technologies like MPLS. Here are the key ways in which SD-WAN helps organizations reduce costs while improving network performance:
1. Reduced Reliance on MPLS and Other Expensive WAN Services
One of the primary cost benefits of SD-WAN is its ability to reduce dependency on Multiprotocol Label Switching (MPLS), which is traditionally expensive and difficult to scale. MPLS circuits are typically priced much higher than broadband or 4G/5G connections.
- Cost Benefit:
- SD-WAN enables businesses to replace or augment costly MPLS connections with lower-cost broadband, fiber, DSL, or 4G/5G links without sacrificing performance.
- By prioritizing traffic and dynamically routing it over various connections (MPLS, broadband, cellular), SD-WAN ensures reliable network performance while significantly lowering WAN costs.
- Example:
- A company with multiple branch offices can reduce the number of MPLS circuits and supplement them with affordable broadband or LTE connections, cutting overall WAN expenses by 50-70%.
2. Improved Bandwidth Utilization and Aggregation
SD-WAN allows businesses to aggregate multiple low-cost internet connections (e.g., broadband, fiber, LTE) to improve bandwidth utilization, maximizing available resources while avoiding the need for high-cost dedicated lines.
- Cost Benefit:
- Businesses can combine multiple cost-effective links to achieve the same or better bandwidth than a single MPLS circuit, eliminating the need to pay for additional high-cost bandwidth.
- SD-WAN helps distribute traffic intelligently across multiple connections, ensuring better utilization of network resources and preventing the need to overprovision expensive bandwidth.
- Example:
- Instead of purchasing a single costly MPLS circuit to increase bandwidth, a company can use two or more broadband connections that provide ample bandwidth for a fraction of the cost.
3. Lower Operational Costs
SD-WAN simplifies network management by providing a centralized platform to manage, monitor, and optimize all WAN connections, reducing the need for complex, manual configurations and minimizing the need for highly specialized WAN management skills.
- Cost Benefit:
- With centralized control and automated provisioning, SD-WAN reduces the complexity of managing multiple WAN links and the need for skilled on-site technicians. This leads to lower operational costs in terms of IT personnel and network management overhead.
- SD-WAN’s ability to deploy updates remotely and automate traffic routing reduces the cost of manual network configuration and troubleshooting.
- Example:
- A business that previously relied on manual configuration of its WAN links can save on IT staffing and consulting fees by using SD-WAN to automatically route traffic and optimize network settings from a centralized location.
4. Reduced Downtime and Improved Business Continuity
Network downtime can be costly for businesses, leading to lost revenue, reduced productivity, and potential service-level agreement (SLA) violations. SD-WAN provides resiliency and failover capabilities, ensuring business continuity and minimizing downtime.
- Cost Benefit:
- SD-WAN’s automated failover capabilities mean that if one network link goes down, traffic can be quickly rerouted to another available link. This reduces the risk of business interruptions and costly downtime.
- Reducing downtime also eliminates the need for expensive emergency repairs or network troubleshooting.
- Example:
- A retail chain using SD-WAN can avoid service outages and the associated costs of lost sales by dynamically switching between primary and backup network connections in the event of a link failure.
5. Scalability and Reduced Hardware Costs
Traditional WAN deployments, especially those reliant on MPLS, often require complex hardware (routers, switches, and firewalls) that must be installed and managed at each branch location. SD-WAN reduces the need for expensive hardware by virtualizing WAN functions and enabling cloud-based management.
- Cost Benefit:
- With SD-WAN, businesses can use commodity hardware instead of expensive, proprietary WAN appliances. This reduces the capital expenditure (CAPEX) associated with purchasing and maintaining hardware.
- SD-WAN is highly scalable, allowing businesses to easily add new locations or users without needing to invest in costly infrastructure or hardware upgrades.
- Example:
- A growing business with multiple branch offices can deploy SD-WAN using simple, affordable edge devices and manage the network centrally, eliminating the need for costly, complex hardware installations at each site.
6. Simplified Network Management and Reduced WAN Complexity
SD-WAN’s cloud-based management capabilities simplify WAN management, reducing the complexity of overseeing multiple connections and service providers. It also automates traffic routing, reducing the need for constant manual intervention.
- Cost Benefit:
- SD-WAN centralizes and simplifies WAN management, eliminating the need for businesses to manage multiple network vendors and services manually, reducing administrative costs.
- Automation of tasks like traffic routing, link monitoring, and bandwidth management reduces the time and resources required to manage WAN operations.
- Example:
- A business with 10 locations can reduce the time IT staff spends managing network configurations and troubleshooting by using SD-WAN to automate these tasks, allowing them to focus on other high-value projects.
7. Better Use of Broadband and Cellular Connections
SD-WAN allows businesses to take advantage of broadband and cellular connections (like LTE or 5G) to support branch offices, remote workers, or temporary locations, which can be significantly more affordable than traditional WAN services like MPLS or dedicated leased lines.
- Cost Benefit:
- Businesses can use lower-cost broadband and cellular links for non-critical traffic or as backup connections, significantly reducing reliance on more expensive WAN links.
- With the ability to prioritize traffic, SD-WAN ensures that real-time applications like voice and video get high priority on broadband or LTE links, maintaining quality while reducing costs.
- Example:
- A construction company with temporary job sites can use LTE or 5G connections alongside SD-WAN to provide reliable, cost-effective network access without needing expensive dedicated circuits.
8. Improved Application Performance and Productivity
SD-WAN optimizes the performance of cloud-based applications, including UCaaS, SaaS (Software as a Service), and IaaS (Infrastructure as a Service), by dynamically routing traffic over the best-performing links. This leads to better application performance and improved productivity, which indirectly reduces costs by enabling smoother operations.
- Cost Benefit:
- By improving application performance, SD-WAN helps businesses avoid costs associated with productivity loss and frustrated employees due to poor network performance.
- Optimized traffic routing for critical applications reduces the need for overprovisioning bandwidth, cutting expenses while maintaining service quality.
- Example:
- A company using UCaaS for voice and video communications can ensure consistent call quality with SD-WAN, preventing productivity loss from poor connections and avoiding the need for premium, high-cost bandwidth.
9. Enhanced Security at a Lower Cost
SD-WAN offers integrated security features such as encryption, firewall services, and secure VPNs without the need for additional, expensive security appliances at each branch location.
- Cost Benefit:
- Businesses can reduce the need to purchase and manage separate security appliances (e.g., firewalls, VPNs) by using the built-in security features that come with SD-WAN solutions.
- SD-WAN enables end-to-end encryption, protecting traffic over public internet connections while avoiding the high costs of securing private WAN links.
- Example:
- A healthcare provider with multiple clinics can implement SD-WAN with integrated security features to comply with HIPAA regulations, reducing the need for additional firewall hardware and lowering security costs.
10. Simplified Branch Expansion and Management
SD-WAN makes it easier and more cost-effective to deploy and manage branch offices or remote sites, reducing the costs associated with complex WAN setups and ongoing branch management.
- Cost Benefit:
- Deploying new branch locations with SD-WAN is faster and more affordable compared to traditional WAN setups, as businesses can use commodity internet connections (broadband, LTE) instead of requiring expensive leased lines or MPLS circuits.
- Centralized control and configuration allow businesses to remotely manage branch networks, reducing the need for on-site IT personnel and minimizing deployment costs.
- Example:
- A retail chain expanding to new locations can quickly set up secure, reliable connectivity using SD-WAN over local broadband connections without waiting for expensive MPLS circuits to be installed.
Conclusion
SD-WAN provides significant cost benefits by optimizing network resources, reducing reliance on expensive WAN technologies like MPLS, improving bandwidth utilization, and enabling cost-effective scalability. Businesses can achieve better network performance, higher reliability, and improved security while reducing both capital and operational expenses. By leveraging multiple cost-effective network connections and centralizing network management, SD-WAN delivers a compelling solution for businesses looking to optimize their WAN performance while controlling costs.