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Software Defined Networking (SDN) Market

ID: MRFR/ICT/1076-CR
124 Pages
Aarti Dhapte
March 2023

Software Defined Networking (SDN) Market Size, Share and Trends Analysis Report By Component (Hardware Component, Services and Software), By Application (Open SDN, SDN via API, and SDN via Overlay), By Solution (Physical Network Infrastructure Solution, Network Virtualization, and Automation Solution), By End-User (Retail, IT & Telecommunication, Healthcare, BFSI, Industrial, and Government), And By Region (North America, Europe, Asia-Pacific, And Rest Of The World) –Market Forecast Till 2035.

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Software Defined Networking (SDN) Market Summary

As per MRFR analysis, the Software Defined Networking Market Size was estimated at 9356.46 USD Million in 2024. The Software Defined Networking industry is projected to grow from 10367.15 in 2025 to 28915.87 by 2035, exhibiting a compound annual growth rate (CAGR) of 10.8 % during the forecast period 2025 - 2035.

Key Market Trends & Highlights

The Software Defined Networking Market is experiencing robust growth driven by technological advancements and evolving user demands.

  • North America remains the largest market for Software Defined Networking, driven by extensive cloud adoption and advanced infrastructure.
  • Asia-Pacific is emerging as the fastest-growing region, fueled by rapid digital transformation and increasing investments in network technologies.
  • The Data Center segment continues to dominate the market, while Cloud Networking is witnessing the fastest growth due to the surge in cloud service adoption.
  • Key market drivers include the growing demand for network virtualization and the rise of IoT and connected devices, which are reshaping networking strategies.

Market Size & Forecast

2024 Market Size 9356.46 (USD Million)
2035 Market Size 28915.87 (USD Million)
CAGR (2025 - 2035) 10.8%

Major Players

Cisco Systems (US), VMware (US), Juniper Networks (US), Arista Networks (US), Hewlett Packard Enterprise (US), Nokia (FI), IBM (US), Microsoft (US), Huawei Technologies (CN), Extreme Networks (US)

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Software Defined Networking (SDN) Market Trends

The Software Defined Networking Market is currently experiencing a transformative phase characterized by rapid technological advancements and increasing adoption across various sectors. Organizations are increasingly recognizing the benefits of software-defined networking, which offers enhanced flexibility, scalability, and cost efficiency. This paradigm shift allows for centralized control of network resources, enabling businesses to respond swiftly to changing demands and optimize their operations. As enterprises seek to improve their network performance and reduce operational complexities, the Software Defined Networking Market is poised for substantial growth. Moreover, the integration of artificial intelligence and machine learning into software-defined networking solutions is becoming more prevalent. These technologies facilitate intelligent network management, predictive analytics, and automated decision-making processes. Consequently, organizations are likely to enhance their network security and performance while minimizing human intervention. The Software Defined Networking Market appears to be on the brink of significant evolution, driven by these technological innovations and the increasing need for agile networking solutions in a dynamic business environment.

Increased Adoption of Cloud Services

The Software Defined Networking Market is witnessing a surge in the adoption of cloud services. Organizations are increasingly migrating their operations to cloud-based platforms, necessitating more flexible and efficient networking solutions. This trend indicates a shift towards hybrid and multi-cloud environments, where software-defined networking plays a crucial role in managing diverse network architectures.

Focus on Network Security

As cyber threats continue to evolve, the Software Defined Networking Market is placing greater emphasis on security measures. Organizations are seeking solutions that not only enhance network performance but also provide robust security features. This trend suggests a growing awareness of the need for integrated security protocols within software-defined networking frameworks.

Emergence of Edge Computing

The rise of edge computing is influencing the Software Defined Networking Market significantly. With the proliferation of IoT devices and the demand for real-time data processing, organizations are looking to deploy software-defined networking solutions that can efficiently manage edge resources. This trend indicates a shift towards decentralized network architectures, enhancing responsiveness and reducing latency.

Software Defined Networking (SDN) Market Drivers

Market Growth Projections

The Global Software Defined Networking Market (SDN) Market Industry is projected to experience substantial growth over the coming years. With an estimated market value of 9.36 USD Billion in 2024, it is expected to reach 32.1 USD Billion by 2035, reflecting a compound annual growth rate (CAGR) of 11.85% from 2025 to 2035. This growth is indicative of the increasing reliance on SDN technologies across various sectors, driven by the need for enhanced network management, security, and scalability. As organizations continue to embrace digital transformation, the SDN market is likely to expand, presenting numerous opportunities for innovation and investment.

Emergence of 5G Technology

The emergence of 5G technology is poised to have a transformative impact on the Global Software Defined Networking Market (SDN) Market Industry. 5G networks require advanced management and orchestration capabilities to handle the increased data traffic and connectivity demands. SDN enables operators to dynamically allocate resources and optimize network performance in real-time, which is essential for delivering the high-speed, low-latency services promised by 5G. As the rollout of 5G continues, the integration of SDN solutions is likely to accelerate, fostering innovation and enhancing user experiences across various applications, from IoT to smart cities.

Growing Adoption of Cloud Services

The Global Software Defined Networking Market (SDN) Market Industry is significantly influenced by the growing adoption of cloud services. As organizations migrate to cloud-based infrastructures, the need for agile and scalable networking solutions becomes critical. SDN facilitates seamless integration with cloud environments, allowing for dynamic resource allocation and improved network performance. This trend is particularly pronounced among enterprises looking to enhance their digital transformation initiatives. By 2035, the market is anticipated to expand to 32.1 USD Billion, reflecting the increasing reliance on cloud technologies and the corresponding demand for SDN solutions that support these environments.

Regulatory Compliance and Standards

The Global Software Defined Networking Market (SDN) Market Industry is also shaped by the need for regulatory compliance and adherence to industry standards. Organizations are increasingly required to meet stringent regulations regarding data privacy and network security. SDN solutions offer the flexibility to implement compliance measures efficiently, allowing organizations to adapt their network configurations in response to changing regulatory landscapes. This adaptability is crucial for businesses operating in highly regulated sectors, such as finance and healthcare. As compliance requirements continue to evolve, the demand for SDN technologies that facilitate regulatory adherence is expected to rise, further driving market growth.

Enhanced Network Security Requirements

In the context of the Global Software Defined Networking (SDN) Market Industry, enhanced network security requirements are driving the adoption of SDN technologies. As cyber threats become more sophisticated, organizations are compelled to implement robust security measures within their networks. SDN provides centralized control and visibility, enabling real-time monitoring and rapid response to security incidents. This capability is particularly valuable in sectors such as finance and healthcare, where data protection is paramount. The increasing focus on cybersecurity is likely to propel the SDN market forward, as organizations seek solutions that not only optimize performance but also fortify their defenses against potential threats.

Increased Demand for Network Virtualization

The Global Software Defined Networking Market (SDN) Market Industry experiences heightened demand for network virtualization as organizations seek to enhance operational efficiency and reduce costs. Virtualization allows for the abstraction of network resources, enabling more flexible and scalable network management. In 2024, the market is projected to reach 9.36 USD Billion, driven by enterprises adopting SDN solutions to streamline their network infrastructures. This trend is particularly evident in sectors such as telecommunications and data centers, where the need for rapid deployment and adaptability is paramount. As businesses increasingly recognize the benefits of virtualization, the SDN market is expected to flourish.

Market Segment Insights

By Application: Data Center (Largest) vs. Cloud Networking (Fastest-Growing)

The Software Defined Networking Market exhibits a varied distribution across its application segments, with Data Center applications commanding the largest share. This dominance is attributed to the increasing demand for virtualization and efficient resource allocation in large-scale data processing environments. Following closely, Cloud Networking has emerged as a significant player within this space, driven by the surge in cloud-based solutions and the need for seamless connectivity amidst rising workloads in digital operations.

Enterprise Networking (Dominant) vs. Wide Area Network (Emerging)

In the realm of Software Defined Networking, Enterprise Networking holds a dominant position, primarily due to the growing need for improved network management and optimization among businesses. This segment benefits from the integration of software-driven solutions that enable agility and scalability in organizational networks. On the other hand, Wide Area Networks are emerging with robust growth prospects, influenced by the wider deployment of remote work solutions and the need for resilient connectivity across geographically dispersed locations. While the Enterprise Networking segment has established itself as the cornerstone of corporate infrastructures, Wide Area Networks are rapidly adapting to meet evolving demands.

By End Use: Telecommunications (Largest) vs. BFSI (Fastest-Growing)

The Software Defined Networking (SDN) market is primarily driven by the telecommunications sector, which holds the largest market share. This segment leverages SDN technologies to enhance network efficiency, manageability, and performance, providing a strong foundation for various telecom applications. Following closely is the BFSI sector, recognized for its rapidly evolving digital landscape. Although relatively smaller in market share compared to telecommunications, BFSI's adoption of SDN is gaining traction, signifying a shift towards more agile and secure network infrastructures.

Telecommunications: Dominant vs. BFSI: Emerging

The telecommunications sector is the dominant force in the SDN market, capitalizing on its vast customer base and extensive infrastructure. It focuses on network optimization, service delivery, and cost reduction while addressing the increasing demand for bandwidth and connectivity. On the other hand, the BFSI sector is emerging rapidly as it seeks to modernize its digital services. Financial institutions are increasingly adopting SDN to enhance security, streamline operations, and support digital banking initiatives. This growing focus on agility and resilience in network management positions BFSI as a crucial segment in the evolving SDN landscape.

By Deployment Type: Cloud-Based (Largest) vs. Hybrid (Fastest-Growing)

The Software Defined Networking (SDN) market showcases a diverse range of deployment types, predominantly led by Cloud-Based solutions, reflecting continuous innovation and consumer demand for flexibility. On-Premises deployments serve a significant niche, catering to enterprises requiring strict data control and security. Hybrid models, integrating both cloud and on-premises advantages, are progressively closing the gap, capturing the attention of businesses looking for balanced solutions and versatile operations.

Cloud-Based (Dominant) vs. Hybrid (Emerging)

Cloud-Based deployments represent the dominant choice in the Software Defined Networking segment due to their scalability, cost-effectiveness, and ease of integration with various applications. This growth can be attributed to the increasing adoption of cloud technologies across industries, driven by the need for efficient resource management. Conversely, Hybrid deployments are emerging robustly, offering a unique blend of both cloud agility and on-premises security. As more enterprises seek to customize their networking environments, hybrid solutions cater to varied operational needs, thereby establishing themselves as significant contenders in the SDN landscape.

By Network Type: Physical Network (Largest) vs. Virtual Network (Fastest-Growing)

The Software Defined Networking (SDN) market is significantly influenced by the three network types: Physical, Virtual, and Hybrid Networks. The Physical Network segment holds the largest share, primarily due to its established infrastructure and reliability in handling critical networking tasks. In contrast, the Virtual Network segment is gaining traction as enterprises increasingly adopt cloud services and virtualization technologies, leading to a shift in preference towards more agile and scalable network solutions. The Hybrid Network model, while still growing, aligns well with organizations seeking to balance both cloud and on-premise capabilities, thus capturing a niche market share.

Physical Network (Dominant) vs. Virtual Network (Emerging)

The Physical Network segment remains dominant within the Software Defined Networking landscape, characterized by robust hardware infrastructure that ensures stable and secure data transmission. It is favored by industries that require high performance and low latency connections. Conversely, the Virtual Network segment is emerging rapidly, driven by the demand for flexible and scalable network architectures that can adapt to dynamic business environments. This segment thrives on software-based solutions that reduce dependence on hardware, making networking more cost-effective and efficient. As organizations continue to migrate to cloud-based solutions, the virtual network's adaptation to these trends enhances its market appeal and growth potential.

By Component: Hardware (Largest) vs. Services (Fastest-Growing)

In the Software Defined Networking (SDN) market, the component segment is dominated by hardware, which constitutes the largest share due to the increasing demand for physical networking devices that enable virtualization and programmability. Following hardware are software solutions that facilitate SDN capabilities, while services, although currently smaller, are on a rapid growth trajectory driven by the demand for consulting, integration, and support in SDN implementations.

Hardware: Switches (Dominant) vs. Services: Consulting (Emerging)

In the domain of SDN, hardware, particularly networking switches, remains the dominant force. These switches are essential for routing and managing data traffic in software-defined environments, enabling organizations to leverage network flexibility and scalability. On the other hand, the services aspect, especially consulting services, is emerging rapidly as businesses seek expertise for their SDN transitions. This increase in service demand reflects the growing need for specialized knowledge in integrating SDN into existing IT frameworks, allowing organizations to navigate the complexities of infrastructure changes effectively.

Get more detailed insights about Software Defined Networking (SDN) Market

Regional Insights

North America : Market Leader in Innovation

North America continues to lead the Software Defined Networking (SDN) market, holding a significant share of 5000.0. The region's growth is driven by increasing demand for cloud-based solutions, enhanced network management, and the adoption of IoT technologies. Regulatory support for digital transformation initiatives further catalyzes market expansion, making it a hub for innovation and investment in SDN technologies. The competitive landscape is characterized by major players such as Cisco Systems, VMware, and Juniper Networks, all headquartered in the US. These companies are at the forefront of technological advancements, offering robust solutions that cater to diverse industries. The presence of these key players, along with a strong focus on R&D, positions North America as a formidable force in The Software Defined Networking.

Europe : Emerging Market with Growth Potential

Europe's Software Defined Networking market is poised for growth, with a market size of 2500.0. The region is witnessing a surge in demand for SDN solutions driven by the need for efficient network management and the transition to 5G technologies. Regulatory frameworks promoting digital infrastructure investments are also key growth catalysts, enhancing the region's appeal for SDN adoption. Leading countries such as Germany, the UK, and France are at the forefront of this market, supported by a competitive landscape featuring companies like Nokia and IBM. The presence of these key players, along with increasing investments in digital transformation, positions Europe as a significant player in The Software Defined Networking. "The European Commission emphasizes the importance of digital infrastructure for economic growth and innovation," said a spokesperson from the Commission.

Asia-Pacific : Rapid Growth in Emerging Markets

The Asia-Pacific region is experiencing rapid growth in the Software Defined Networking market, with a market size of 1500.0. Factors such as increasing internet penetration, the rise of smart cities, and the demand for scalable network solutions are driving this growth. Additionally, government initiatives aimed at enhancing digital infrastructure are acting as significant catalysts for SDN adoption across the region. Countries like China, India, and Japan are leading the charge, with major players such as Huawei Technologies and Arista Networks making substantial investments. The competitive landscape is evolving, with local startups also entering the market, contributing to a dynamic environment. This growth trajectory positions Asia-Pacific as a key player in the global SDN landscape.

Middle East and Africa : Emerging Frontier for Technology

The Middle East and Africa region is emerging as a frontier for Software Defined Networking, with a market size of 356.46. The growth is driven by increasing investments in digital transformation and the need for efficient network management solutions. Regulatory support for technology adoption and infrastructure development is also fostering a conducive environment for SDN growth in this region. Countries like South Africa and the UAE are leading the way, with a growing presence of key players such as Cisco and Microsoft. The competitive landscape is characterized by a mix of established companies and local startups, creating opportunities for innovation and collaboration. This dynamic environment positions the Middle East and Africa as a promising market for SDN solutions.

Software Defined Networking (SDN) Market Regional Image

Key Players and Competitive Insights

The Software Defined Networking Market is currently characterized by a dynamic competitive landscape, driven by rapid technological advancements and increasing demand for network flexibility and efficiency. Major players such as Cisco Systems (US), VMware (US), and Juniper Networks (US) are strategically positioned to leverage their extensive portfolios and innovative capabilities. Cisco Systems (US) focuses on enhancing its software offerings, particularly in security and automation, while VMware (US) emphasizes its cloud-native solutions to facilitate digital transformation. Juniper Networks (US) is concentrating on AI-driven networking solutions, which appear to be gaining traction in the market. Collectively, these strategies contribute to a competitive environment that is increasingly defined by innovation and the ability to adapt to evolving customer needs. Key business tactics within the Software Defined Networking Market include localizing manufacturing and optimizing supply chains to enhance operational efficiency. The market structure is moderately fragmented, with a mix of established players and emerging startups. This fragmentation allows for diverse offerings and competitive pricing, although the influence of key players remains substantial. The collective actions of these companies shape market dynamics, as they strive to differentiate themselves through unique value propositions and technological advancements. In November 2025, Cisco Systems (US) announced a strategic partnership with a leading cloud service provider to enhance its SDN capabilities. This collaboration aims to integrate advanced security features into cloud environments, thereby addressing growing concerns over data protection. The strategic importance of this partnership lies in its potential to position Cisco as a leader in secure cloud networking, catering to enterprises increasingly reliant on cloud infrastructure. In October 2025, VMware (US) launched a new version of its SDN platform, which incorporates AI-driven analytics to optimize network performance. This development is significant as it reflects VMware's commitment to innovation and its focus on providing customers with actionable insights to improve operational efficiency. By integrating AI capabilities, VMware is likely to enhance its competitive edge, appealing to organizations seeking to leverage data for better decision-making. In September 2025, Juniper Networks (US) expanded its global footprint by entering into a strategic alliance with a telecommunications provider in Asia. This move is indicative of Juniper's strategy to penetrate emerging markets and capitalize on the growing demand for SDN solutions in the region. The alliance is expected to facilitate the deployment of next-generation networking technologies, thereby enhancing Juniper's market presence and driving revenue growth. As of December 2025, current competitive trends in the Software Defined Networking Market are increasingly influenced by digitalization, sustainability, and AI integration. Strategic alliances are playing a pivotal role in shaping the landscape, enabling companies to pool resources and expertise to address complex challenges. Looking ahead, competitive differentiation is likely to evolve, with a pronounced shift from price-based competition to a focus on innovation, technology, and supply chain reliability. This transition underscores the importance of agility and responsiveness in meeting the demands of a rapidly changing market.

Key Companies in the Software Defined Networking (SDN) Market include

Industry Developments

  • Q2 2024: Hewlett Packard Enterprise to acquire Juniper Networks for $14 billion in AI-driven networking push Hewlett Packard Enterprise (HPE) announced it will acquire Juniper Networks in an all-cash deal valued at $14 billion, aiming to strengthen its position in software-defined networking and AI-powered network solutions.
  • Q2 2024: Arista Networks acquires VMware’s VeloCloud SD-WAN business Arista Networks announced the acquisition of VMware’s VeloCloud SD-WAN business, expanding its portfolio in software-defined networking and edge connectivity.
  • Q2 2024: Juniper Networks Introduces AI-Native Networking Platform Juniper Networks launched a new AI-native networking platform designed to deliver fully automated, software-defined network operations for enterprise and cloud customers.
  • Q2 2024: Cisco Launches New Software-Defined Networking Solutions for AI Workloads Cisco unveiled a suite of software-defined networking solutions optimized for AI and machine learning workloads, targeting data centers and cloud providers.
  • Q2 2024: Extreme Networks Expands Universal Platform with New SDN Capabilities Extreme Networks announced enhancements to its Universal Platform, adding advanced software-defined networking features to support multi-cloud and edge deployments.
  • Q3 2024: HPE completes $14bn Juniper Networks acquisition Hewlett Packard Enterprise finalized its $14 billion acquisition of Juniper Networks, integrating Juniper’s software-defined networking and AI-driven technologies into its portfolio.
  • Q3 2024: Arista Networks Finalizes Acquisition of VeloCloud SD-WAN Business Arista Networks completed its acquisition of the VeloCloud SD-WAN business from VMware, strengthening its position in the software-defined networking market.
  • Q3 2024: Nokia launches new SDN controller for 5G and edge networks Nokia introduced a new software-defined networking controller designed to manage 5G and edge network deployments, enabling greater automation and programmability.
  • Q3 2024: Arrcus raises $65M Series D to expand software-defined networking platform Arrcus, a software-defined networking startup, secured $65 million in Series D funding to accelerate development and global expansion of its SDN platform.
  • Q4 2024: Cisco acquires Isovalent to boost cloud-native SDN capabilities Cisco announced the acquisition of Isovalent, a company specializing in cloud-native software-defined networking, to enhance its offerings for enterprise and cloud customers.
  • Q1 2025: VMware spins off SDN business as standalone entity VMware completed the spin-off of its software-defined networking business, establishing it as an independent company focused on SDN and cloud networking solutions.
  • Q2 2025: Pluribus Networks secures $40M in Series E funding for SDN innovation Pluribus Networks raised $40 million in Series E funding to drive innovation in software-defined networking for data centers and edge environments.

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Future Outlook

Software Defined Networking (SDN) Market Future Outlook

The Software Defined Networking Market is projected to grow at a 10.8% CAGR from 2025 to 2035, driven by increasing demand for network automation and cloud services.

New opportunities lie in:

  • Development of AI-driven network management tools Expansion of SDN solutions in IoT applications Integration of security features in SDN architectures

By 2035, the market is expected to be robust, driven by innovation and strategic implementations.

Market Segmentation

Software Defined Networking Market End Use Outlook

  • Telecommunications
  • BFSI
  • Healthcare
  • Government

Software Defined Networking Market Component Outlook

  • Hardware
  • Software
  • Services

Software Defined Networking Market Application Outlook

  • Data Center
  • Enterprise Networking
  • Wide Area Network
  • Cloud Networking

Software Defined Networking Market Network Type Outlook

  • Physical Network
  • Virtual Network
  • Hybrid Network

Software Defined Networking Market Deployment Type Outlook

  • On-Premises
  • Cloud-Based
  • Hybrid

Report Scope

MARKET SIZE 2024 9356.46 (USD Million)
MARKET SIZE 2025 10367.15 (USD Million)
MARKET SIZE 2035 28915.87 (USD Million)
COMPOUND ANNUAL GROWTH RATE (CAGR) 10.8% (2025 - 2035)
REPORT COVERAGE Revenue Forecast, Competitive Landscape, Growth Factors, and Trends
BASE YEAR 2024
Market Forecast Period 2025 - 2035
Historical Data 2019 - 2024
Market Forecast Units USD Million
Key Companies Profiled Cisco Systems (US), VMware (US), Juniper Networks (US), Arista Networks (US), Hewlett Packard Enterprise (US), Nokia (FI), IBM (US), Microsoft (US), Huawei Technologies (CN), Extreme Networks (US)
Segments Covered Application, End Use, Deployment Type, Network Type, Component
Key Market Opportunities Integration of artificial intelligence enhances automation and efficiency in the Software Defined Networking Market.
Key Market Dynamics Rising demand for network agility drives innovation and competition in the Software Defined Networking landscape.
Countries Covered North America, Europe, APAC, South America, MEA

Market Highlights

Author
Aarti Dhapte
Team Lead - Research

She holds an experience of about 6+ years in Market Research and Business Consulting, working under the spectrum of Information Communication Technology, Telecommunications and Semiconductor domains. Aarti conceptualizes and implements a scalable business strategy and provides strategic leadership to the clients. Her expertise lies in market estimation, competitive intelligence, pipeline analysis, customer assessment, etc.

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FAQs

How much is the Software Defined Networking (SDN) market?

The global Software Defined Networking (SDN) market size was valued at USD 8136.05 Million in 2023.

What is the growth rate of the Software Defined Networking (SDN) market?

The global market is projected to grow at a CAGR of 10.80% during the forecast period, 2024-2032.

Which Region held the largest Software Defined Networking (SDN) market share?

North America had the largest share of the global market

Who are the key players in the Software Defined Networking (SDN) market?

The key players in the market are Intel Corporation, Pluribus Networks Inc. (U.S.), Hewlett Packard Enterprise Company(U.S.), Huawei Technologies Co. Ltd., Cisco Systems Inc. (U.S.), Juniper Networks Inc. (U.S.), NEC Corporation (Japan), Pica8 Inc. (U.S.), and IBM Corporation.

Which component led the Software Defined Networking (SDN) market?

The software component dominated the market in 2023.

Which end-user had the largest Software Defined Networking (SDN) market share?

BFSI had the largest share of the global market.

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