The software-defined networking market is continuing to grow, though not quite how some vendors would like.
The market is fairly mature, and SD-WAN deployments are now nearly ubiquitous among large enterprises, according to ISG’s 2025 Provider Lens Network Software-defined Solutions and Services report. Small and medium-sized businesses are also showing growing adoption. But one deployment trend that hasn’t take off is the full-blown, rip-and-replacement of legacy networks.
ISG’s study covers software-defined solutions and services for the U.S. market. The research firm evaluated 36 providers across four key areas: managed SD-WAN services, transformation consulting, edge technologies, and secure access service edge (SASE) solutions.
The research reveals several critical findings that challenge conventional wisdom about SD-WAN deployments:
- Even digitally mature enterprises are avoiding complete infrastructure replacements in favor of phased transitions.
- AI-driven automation is delivering measurable benefits, but fully autonomous network management remains aspirational.
- SASE adoption strategies vary significantly by geography and organizational size.
- Edge computing and private 5G integration has moved from concept to practical implementation in industrial settings.
“The biggest surprise was the strong demand for real-time, AI-driven automation capabilities in SD-network deployments,” Yash Jethani Pradeep, senior manager and principal analyst at ISG, told Network World. “This underscores that many enterprises are not just seeking basic solutions but are looking for advanced functionalities that enhance operational efficiencies and decision-making processes.”
Enterprise reality: Phased transitions dominate
The ISG report documents two primary SD-WAN deployment approaches among U.S. enterprises. Many organizations overlay SD-WANs on existing infrastructure, enhancing performance and scalability over time. Others replace legacy networks completely after testing SD-WAN service level agreements against functional and business requirements.
However, despite aggressive vendor positioning around complete infrastructure overhauls, ISG’s research shows that overlay approaches are winning. Even the most technologically advanced organizations are taking a more cautious approach to SD-WAN deployments.
“Honestly, even the digitally mature enterprises are favoring controlled, phased transitions due to operational complexity, embedded legacy contracts, and compliance friction,” Pradeep said. “The reality is ‘rip-and-replace’ is not happening, despite the hype created by new-age providers of cloud native or zero trust solutions.”
Pradeep added that ISG is seeing a degree of change fatigue in organizations. Concerns around app migration, cloud complexity and cybersecurity readiness tend to dominate the conversations. On the other hand, he noted that smaller, nimbler enterprises do prefer complete replacements.
AI-driven automation: Real benefits, human oversight required
The ISG research revealed significant enterprise demand for artificial intelligence capabilities in SD-WAN deployments. However, the current reality differs substantially from vendor promises of fully autonomous networks.
The research found that leading organizations are deploying AI for several specific use cases:
- Self-healing networks and zero-touch provisioning.
- Traffic classification and dynamic path optimization.
- Proactive failover capabilities.
- Alert triaging and management.
However, the research also reveals significant limitations in current AI capabilities.
“We did not see evidence of autonomous WAN tuning with GenAI Copilot,” Pradeep explained. “There has to be a human in the loop still. AI-led SLA enforcement is also aspirational as you correlate telemetry across networks, apps, identity, etc.”
Edge computing and 5G: Production deployments underway
The research also shows that there are ongoing implementations of edge computing and private 5G integration with SD-WAN infrastructure.
“We saw private 5G as an SD-WAN link in warehouses, ports and factories for low-latency/high-reliability apps beyond the usual uCPEs and SASE boxes deployed at micro-branches with 5G fallback and real-time telemetry,” Pradeep said.
Looking forward, ISG expects expanded integration capabilities across multiple technologies.
“Engineering LEO [Low Earth Orbit] with Starlink, Kuiper, and Wi-Fi 6/7 could increase over the next 1-3 years with work being done on microsegmentation, open APIs for workload management, and SASE integration in real time,” he said.
Source:: Network World