Hewlett-Packard Enterprise (HPE) announced its intent to acquire Silver Peak, a software-defined wide area network (SD-WAN) platform provider, which will be incorporated into its Aruba Networks subsidiary.
Keerti Melkote, president of Intelligent Edge for HPE, told industry analysts the $925 million acquisition will eventually lead to edge computing devices all being managed via the same cloud framework regardless of physical location.
Aruba Networks has been making a case for unifying the management of wired and wireless networking in branch offices via a cloud management platform. The acquisition of Silver Peak will extend the reach of that framework to SD-WANs, which are becoming more widely employed to connect both remote offices and end users working at home to applications running both in the cloud and in the local data center.
In the wake of the COVID-19 pandemic, the number of employees working from home and needing direct access to applications has exploded. Rather than employing virtual private networks (VPNs) to connect all those home offices to a local branch office, it’s more efficient and secure to connect those working at home to applications residing in both the cloud and on-premises IT environments via SD-WANs.
HPE claims the total addressable market for networking services aimed at various edge computing use cases is north of $32 billion, which includes both SD-WANs and wireless and wired networks deployed in the branch office.
Silver Peak currently has more than 1,500 customers and in its last fiscal year generated $132 million in revenue. The challenge HPE and its Aruba Networks subsidiary will face is most SD-WANs that have been deployed thus far use appliances that were acquired by internal IT teams. Increasingly, however, SD-WANs are being consumed as a managed service. Aruba provides customers access to a cloud console to manage networks deployed in remote offices. It’s not clear how many internal IT organizations moving forward will want to manage remote networks versus relying on a managed service provider (MSP).
Of course, HPE and Aruba can opt to provide a managed service. However, they will need to build out the points of presence (PoPs) to deliver a managed SD-WAN service—something many MSPs, especially telecommunications providers, and cloud service providers have already done.
Longer-term, it’s also not clear to what degree wireless 5G services will eliminate the need for not just wired networks, but also wireless local area networks (LANs) in branch offices. Some IT organizations may conclude the cost of a 5G cellular service is less than the total cost of managing a LAN.
There is, of course, no absolute when it comes to networking. However, if more employees are working from home for the foreseeable future, the dynamics of networking at the edge will never be the same. Developers especially will need to take into account a whole different level of network latency dynamics when deploying applications. The irony is that as applications become more distributed, the management of the networks on which they depend is becoming more centralized.
