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Proliferation of Data Centers Driving the Growth of the Software-defined Networking Market

   March 7, 2024

In recent years, enterprises have started incorporating complex systems to support changing customer needs. Organizations across sectors are increasingly distributing their IT workloads and relying on data centers to fulfill their network and IT infrastructure needs. Owing to the continuous investments in technology advancement, data centers are facing challenges in managing increasingly complex and dynamic networks. There is a high demand for network automation solutions among data centers due to the need for improved security and high-speed business communications. Hence, data centers are relying heavily on software-defined networking solutions to implement effective connectivity, improve security, and offer centralized network management services. Thus, the rising demand for centralized network management is boosting the adoption of software-defined networking solutions, driving the growth of the SDN market.

According to Brightlio (U.S.), as of December 2023, there were approximately 10,978 data centers globally, with over 9,861 located in the top 20 countries, which are as follows:

Software-defined Networking Market

The rapid proliferation of data centers and the high adoption of SDN across data centers are driving the growth of the software-defined networking market. According to the Cisco Annual Internet Report (2018-2023), SDN is among the major technologies that will have the most impact on the networking industry, with the deployment of SDN solutions expected to increase by 23% within the next 24 months. Also, according to Cisco’s Global Cloud Index Report (2021), 64% of IT leaders and network strategists have implemented SDN in their data centers, and SDN technology manages approximately 23% of traffic within enterprise data centers. Several organizations are collaborating with SDN solution providers to deploy software-defined networking solutions to automate data center networks. For instance, in August 2023, Cisco Systems, Inc. (U.S.) collaborated with Sirti S.p.A. (Italy) to develop a digital transformation project for automating TERNA S.p.A.’s (Italy) data center telecommunications network using SDN technologies. Also, in November 2022, GDS Services Ltd. (China) signed a Memorandum of Understating (MoU) with DCConnect Global Limited (Singapore) to SDN technology in GDS data centers to enable the delivery of a range of new services to enterprises. Thus, the increasing deployment of software-defined networking in data centers and the rapid proliferation of data centers are driving the growth of the software-defined networking market.

Conclusion

The proliferation of data centers, coupled with the growth in IoT and big data technologies, has led to a significant increase in data traffic. SDN’s ability to optimize network performance and handle large data volumes is crucial for smooth data center operations. Hence, the proliferation of data centers and the increasing adoption of SDN among Data centers are driving the growth of the SDN market.

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