- TM has been offering SD-WAN since November 2018, but Maxis’ launch of its service last month marked the beginning of the real competition.
- More carriers, integrators and resellers are expected to join the bandwagon, driven by customer demand.
SD-WAN in Malaysia
SD-WAN is not new; it has been around in the market globally for several years, offered by various providers such as carriers, system integrators and value-added resellers. The ecosystem is maturing, with a growing number of vendors and new capabilities having been developed (e.g., multi-vendor interworking, overlay-underlay integration, more virtual network services, network-cloud convergence). However, the market is only beginning to gain momentum in Malaysia. Telekom Malaysia (TM), the fixed-line incumbent provider in the country, launched the service in November last year, offering its customers two vendor options. The provider has not been aggressive in the market with its SD-WAN services due to the risk of losing its business from the legacy data services (e.g., IP VPN, Ethernet, Dedicated Internet) as well as the lack of competition. While there are smaller telcos, value-added reseller and system integrators such as RedTone, ViewQwest, Netpoleon, LNS and BreitKom in the market, its major competitor – Maxis – only launched SD-WAN last month, while Time has yet to offer the service.
The Real Competition Begins
Maxis’ SD-WAN launch marked the beginning of the real competition in Malaysia. The leading mobile provider has been strengthening its enterprise service business and gaining market share from TM. Maxis offers Meraki-based SD-WAN services to provide a lower entry barrier for enterprises and to address a large number of companies with Cisco environments. However, unlike TM, Maxis does not have a large subscriber base for its legacy data services. The provider is expected to be more aggressive in the market to win new enterprises and by upselling the services to its existing customers. It could also use its mobile network as an underlay to differentiate against TM.
SD-WAN is still in its early phase in Malaysia. Enterprises could expect to see other mobile providers such as Celcom and Digi offering their own services soon, as both carriers are expanding their fixed-line and enterprise portfolio. Global carriers that are several steps ahead in terms of product capabilities and service delivery could also disrupt the domestic market. For example, in Indonesia, NTT recently edged out the local providers to win a deal with a leading bank to provide SD-WAN across more than 120 branches. The national system integrators and other resellers are expected to join the bandwagon too, seeing the demand and opportunity to drive their business. Based on recent research by GlobalData, around 50% of enterprises acquired their SD-WAN from a vendor directly or through a reseller, 40% from managed service providers or carriers, and 10% from system integrators. Currently, SD-WAN services are offered as a standalone product with limited capabilities. As competition increases, enterprises could expect more features (e.g., integration with other carriers’ underlay networks, uCPE, VNS) and more vendor options from which to choose. There are at least ten major global SD-WAN vendors; each has its own strengths and may fit specific enterprise requirements better than the others.