Industry Trends

Creating a Differentiated SD-WAN Service as a Platform for Revenue Generating Value Added Services (VAS)

By Ronen Shpirer | August 19, 2019

A Brief State of SD-WAN Services

The Communication Service Provider (CSP) community around the world is gradually, but surely, rolling out their SD-WAN solutions and services to the SMB and enterprise market segments. The driving forces empowering these rollouts may differ based on markets conditions and CSPs dominance and position within its local and global markets – but a realization is building that the key potential of a well-thought-of SD-WAN service may lie beyond the service itself – in its potential as an enabler and facilitator for additional VAS and revenue-generating services, and that will drive CSPs' SD-WAN technology and infrastructure choices.

SMB/enterprise customers' main drivers for SD-WAN services are agile and efficient WAN resources utilization, increased application performance, and improved user experience it should deliver. Cost reduction, based on market conditions, may be secondary. It is also important to note that an SD-WAN service is not necessarily more cost-attractive compared to an MPLS service, and, in many cases, MPLS circuits will continue to form some of the SD-WAN underlay used by enterprises. As most serious SD-WAN solutions out there provide similar capabilities, CSPs should mostly differentiate their SD-WAN services on capabilities beyond basic SD-WAN, such as security: SD-WAN should be also seen as a mean to a larger VAS engine, or platform, that increases customer ARPU and loyalty.

Why SD-WAN Should be Treated as a Revenue Generating VAS Platform

Building and delivering SD-WAN should be seen and planned as the first step in making connectivity a platform for new VAS services and revenues. This may be of higher importance for incumbents and dominant network service providers as SD-WAN can be delivered by non-network service providers, newcomers, and pure MSPs, and deployed as an overlay to Over The Top-type service - effectively shrinking the incumbent's present and future footprint and revenues. In addition, using SD-WAN as a springboard to delivering more services can provide a real competitive advantage in a landscape dominated by many SD-WAN service offerings.

Therefore, the CSP's choice of a 1st or 2nd generation SD-WAN solution should take into account its ability to deliver and enable, in addition to SD-WAN, a set of integrated and automated high-value services. In that respect, some of the primary consideration criteria should include the following.

Customer-driven criteria:

  • What VAS, in conjunction with an SD-WAN offering, would be most likely to be in demand by the CSPs' customers today and the near to mid-future?
  • Can these VAS be seamlessly integrated into the SD-WAN offering, so it delivers greater value to the customer - compared to a separate service built on top of SD-WAN? How about when compared to a silo approach?
  • Can the value of such an integrated SD-WAN and VAS platform be easily and rapidly demonstrated and delivered to the customer to justify current and future expenditure?

CSP-driven criteria:

  • What are the existing SD-WAN solution pre-integrated VAS capabilities?
  • What are the onboarding complexities and TTM for both SD-WAN and pre-integrated current and future VAS?
  • Do the solution's APIs and architecture facilitate 3rd party solution and service integration?
  • Is centralized automation, management, and reporting possible for the SD-WAN and pre-integrated VAS solutions?

The Obvious - Adding Security as a VAS to an SD-WAN Service

All research on WAN needs and concerns points to the fact that security is a top customer requirement for SD-WAN. So an SD-WAN solution that integrates an effective and proven NGFW security is an obvious requirement for an immediate VAS. A security solution that is embedded within the SD-WAN platform, such as the Fortinet Secure SD-WAN solution with a custom-designed ASIC to maximize performance and functionality, would be a real advantage as it provides a pre-integrated service which significantly reduces onboarding efforts, and speeds up Time To Market for the service. But other than this "obvious" VAS, what commercially successful set of VAS can an SD-WAN service platform facilitate?

Beyond the WAN and into the SD-Branch as a Service

As SD-WAN is, basically, a more sophisticated and logical connectivity service, aiming to provide application-aware connectivity from multiple sites to data and applications (whether in the public cloud, SaaS or the customers' data center) - a useful way to add SD-WAN related VAS is to extend it to the connectivity within the customers' sites themselves. Access via fixed (switches) and wireless (WiFi) provide branch connectivity that can be extended, upon need, beyond the site via SD-WAN – so adding a managed fixed/wireless and access control solution that integrates with the SD-WAN solution is a logical and commercially viable VAS, referred to as SD-Branch. But it can be truly powerful, and set the CSP apart, if it is integrated with the SD-WAN service and other existing VAS such as security, while benefiting from the same onboarding, zero-touch deployment (ZTD) and provisioning (ZTP), visibility, management, and reporting.

This is the complete opposite of the traditional silo approach and can represent a significant increase in ARPU (Average Revenue Per User) as well as customer stickiness as it will be translated into both CapEx (HW – switches and WiFi APs) and OpEx (service) revenues for the CSP. Fortinet's SD-Branch solution empowers CSPs, MSPs, and MSSPs to extend SD-WAN via a pre-integrated solution that delivers SD-WAN, NGFW security, and fixed and wireless access – all with common Zero Touch Deployment and Provisioning, multi-tenancy, management, and reporting, including a self-management customer portal. From an SMB/Enterprise point of view, the added value of such services is significant as they will allow customers to gain visibility and control over their entire branch environments from a single point of visibility, management, and reporting – hosted and managed by the CSP.

IoT! Let's Not Forget IoT!

Another hot topic and concern for enterprise and SMBs – and therefore a good candidate for a VAS from a CSP perspective - is IoT. The highest concentration of IoT is to be found in the enterprise sites/branches – printers, BYOD, video cameras, all sorts of metering devices, etc. The CSP's customers are struggling to gain visibility and understanding into their network-attached "things," a fact that introduces an unneglectable potential risk and uncertainty. The ability to use the SD-WAN platform as part of an integrated IoT visibility and control VAS would consist a very attractive and differentiated VAS that SMBs/enterprises are looking for and are willing to pay for. Again, a facilitator for fast onboarding, faster TTM, and higher value for such a service would be its integration into the SD-WAN platform so that, rather than being an "over the top" service, it becomes an integrated, on-demand, and payable part of the solution. To achieve precisely that, Fortinet's IoT visibility and control solution, FortiNAC, has been integrated with our SD-WAN/SD-Branch solution.

In a Nutshell

The enterprise edge, its branches and distributed presence is growing in importance as organization transform themselves and empower their workforce. The WAN edge is a growing priority for many organizations, and things like security, advanced application and traffic management, and integrated network and security management tools need to be table-stakes in any SD-WAN solution or offering.

When considering, planning, implementing, and delivering an SD-WAN service, CSPs/MSPs/MSSPs should think differently: by building my SD-WAN service today, they can open a path to a whole range of new services that provide, if correctly done, significant benefits for their customers and significant new revenue streams for themselves, the providers. SD-WAN can be much more than just a new connectivity service for the enterprise WAN edge – it can redefine the depth and range of managed networking and security value-add services. And this is precisely what Fortinet, and only Fortinet, enables service providers to achieve. 

Fortinet’s Secure SD-WAN solution includes best-of-breed next-generation firewall (NGFW) security, SD-WAN, advanced routing, and WAN optimization capabilities, delivering a security-driven networking WAN edge transformation in a unified offering.

Read these customer case studies to see how Warrior Invictus Holding Co., Inc. and the District School Board of Niagara implemented Fortinet’s Secure SD-WAN to alleviate network complexity, increase bandwidth, and reduce security costs.