The global network automation market size was valued at USD 14.56 billion in 2021, presumed to reach USD 72.4 billion, expanding at a CAGR of 22.2% during the forecast period. As a result of rapid technological advancements, networks have become more intricate. As a result of this escalating complexity, network device failures may result in lengthy downtimes, which may negatively impact business operations and overburden IT, workers, as they attempt to execute mitigation. Network automation uses software to configure, provision, manage, and test network equipment. The availability of network services is enhanced by automating routine network operations and functions and managing and controlling repeated processes. Network automation applies to all networks. It is utilized by businesses and service providers to boost efficiency, remove human error, and reduce operational costs. Network automation can encompass a diverse array of tasks. This involves establishing security compliance and offering visibility into reports and dashboards, software updates, data analysis, data gathering, device testing and configuration verification, network planning and design, and more.
Corporate networks are under stress as increasing users, devices, and applications rely on the network for critical access to many endpoints. As a result, enterprises are becoming increasingly interested in innovative network architectures and modern management tools that employ machine learning and artificial intelligence to construct self-driving or autonomous networks. These developments are also drastically altering how businesses rely on the services of their partners and suppliers. IT decision-makers feel that automation is the linchpin for increasing network agility and dependability while managing operational expenditure and capital investment, i.e., automating the 20% of networking chores that consume up to 80% of the staff's time. Reduced operating expenses are one of the most important benefits of network automation. Replacing tiresome and manual operations with automated and managed infrastructures can expand the network's capabilities and achieve a quicker ROI.
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The Rising Demand for Data Center Networks and Popularity of Connected Devices
The increased adoption of cloud computing and advanced applications, like telemedicine, ultra-HD video streaming, virtual reality (VR) streaming, high-frequency stock trading, and linked vehicle safety applications, is driving a massive transformation in data center infrastructure and traffic. Under this pattern, hardware manufacturers are emphasizing the hardware of networks and releasing devices that meet these specifications. This exponential expansion in the market for data centers necessitates enhanced operations, processing speeds, and security, not only via the adoption of data center automation software but also through the use of hardware. Increasingly, data centers are employing artificial intelligence to enhance every element of their operations, including network efficiency, dependability, and efficiency and security. This will push the market of network automation further during the forecast period.
In addition, data center network automation and orchestration projects influence network decisions to fulfill business requirements. Plus, the emergence of new applications and business models and the decline in device prices are crucial in promoting the use of IoT. Consequently, the number of connected devices is increasing. Nevertheless, these IoT and Big Data requirements are spawning a new wave of security and technology convergence challenges. The convergence of technologies facilitated by virtual machines, server software, and revolutionary SDN and NFV-based services will enhance cloud infrastructures' data integrity and security. It is anticipated that the arrival of the Open Wi-Fi Policy will stimulate the proliferation of connected devices over the predicted time. In addition, the popularization of Industry 4.0 standards in the manufacturing industry spawned a new generation of networking. Such factors will propel the need for network automation.
Scarcity of Professional Skilled Workforce
The increasing size and complexity of networks, which require new skillsets and technologies, the difficulties in managing a precise network diagram and network documentation, the troubleshooting processes that contribute to more extended network downtimes, the traditional knowledge and collaboration gaps, and the evolving nature of attacks, which makes network security difficult, are some of the factors that inhibit the growth of the network automation market. In network automation strategic planning, a lack of skills is one of the organizations' most significant obstacles. More than fifty percent of businesses have network automation skills gaps. Automation of a network might reveal skill gaps in network engineers who lack familiarity with new tools and software programming. In addition, application development teams tasked with constructing an internal network or automation software solution lack networking expertise. The market for network automation is anticipated to experience difficulties due to these factors.
Technological Advances in the Field
Numerous industries have undergone digital transformation as a result of technological development, which has expanded the number of network applications. This has significantly increased the complexity of networks and systems, necessitating the installation of automation for future success and fueling the network automation market growth Currently, intent-based networking skills assist enterprises in keeping up with the demands of digital and cloud-based change. Still, there will be comprehensive automated solutions for network management tools and technologies in the future. In addition, adopting software-defined networks, such as software-defined wide-area networks (SD-WANs), has enabled network-automation tools to evolve from operationally focused point products that address change management and setup into policy and orchestration tools.
Data centers are currently under pressure to minimize operating costs and handle many devices, so they prioritize efficiency, simplicity, and automation in their configuration management and use automated solutions. Network vendors are creating broad support for open-source platforms and systems used by data center operators to handle routine tasks like configuration monitoring or data refresh. Hence, such developments in network automation create lucrative opportunities for market participants.
The global network automation market is classified based on network type, solution type, service type, deployment, end-user, and region.
The segments include Physical, Virtual, and Hybrid based on the network type.
The physical network section is projected to advance at a CAGR of 20.2% and hold the largest market share. The physical network includes wires that connect network gear to other networks. Automation in a physical network improves speed and security. Physical layer resistance to software definition and automation means human operators must establish or remove network connections. Unlike all other network levels, which are changing and entering automation, the physical layer has remained manual for 20 years. Physical layer networking automation is one of the essential factors in need of automation and orchestration.
The virtual network section will hold the second-largest share. SDN and NFV require network automation and virtualization. By abstracting network service configuration from physical infrastructure, it should cut costs and speed up service delivery. Software orchestration tools can establish services. SDN and NFV standardize network setup and provisioning via software tools and APIs. Emerging standards, APIs, and open-source initiatives enable network virtualization automation.
Based on solution type, the segments include Network Automation Tools, SD-WAN & Network Virtualization, and Intent-based Networking.
The SD-WAN & Network Virtualization section is projected to advance at a CAGR of 22.1% and hold the largest market share. SDN (software-defined networking) and NFV (network functions virtualization) isolate new network functions from hardware architecture and topological limitations, making communications networks configurable and more flexible, and agile. SDN and NFV provide a lower-cost way for CSPs (cloud service providers) to meet market expectations, facilitating their transformation. Telecom operators need a reduction of CAPEX (capital expenditure), increased efficiency, and innovative offerings to drive this market.
The Network Automation Tools section will hold the second-largest share. Configuration and maintenance tools check for misconfigured devices and allow administrators to repair faults without downtime. They assist in analyzing network traffic by monitoring devices, services, ports, and protocols. A robust automation technology eliminates human errors and decreases operational expenses, boosting corporate growth. Choosing the right automation tool is vital for network efficiency, productivity, and dependability.
Based on service type, the segments include Managed Service and Professional Service.
The managed service section is projected to advance at a CAGR of 22.4% and hold the largest share. Due to more excellent workflow management and cost-effectiveness, managed services are automating networks. The managed services cut in-house management and personnel costs, raising profit margins. Consumer awareness of market services is rising. As the number of start-ups in this market grows, industry players have more opportunities to offer managed services.
The professional service section will hold the second-largest share. Professional network automation services include deployment, integration, training, support, and consulting. Companies are boosting their professional services due to rising maintenance costs. This would help companies focus on company plans and increase market growth.
Based on deployment, the segments include Cloud, On-premise, and Hybrid.
The on-premise section is projected to advance at a CAGR of 19.2% and hold the largest market share. Financial service providers, healthcare companies, and governments prefer on-premise deployment. On-premise deployment is chosen for data and process privacy, perpetual licensing, and customer infrastructure ownership. On-premise network automation solutions are deployed in an organization's network, limiting distant employees' and partners' access to centralized data.
The cloud section will hold the second-largest share. Cloud implementation involves an onsite gateway connection. This architecture supports real-time traffic shaping, multi-circuit load balancing/failover, and improved cloud app performance and dependability. With more cloud-based enterprise apps, cloud-based network automation is gaining popularity. SD-WAN is gaining popularity as organizations realize a clear ROI from cloud-managed WAN.
Based on end-user, the segments include IT & Telecom, Manufacturing, Energy & Utility, Banking & Financial Services, Education, and Other End-user Industries.
The IT & Telecom sector is projected to advance at a CAGR of 20.8% and hold the largest market share. Increasing smartphone use and internet-connected devices strain the telecom network. Insufficient bandwidth and congestion causes call drops and poor network functionality. 5G's growing popularity has complicated the operator's network management demands. Players invest extensively in automation and its underlying technologies, like service orchestration, automation solutions, and Machine Learning (ML). In India, businesses such as Airtel and Vodaphone have embraced network automation. These businesses rely on machine learning to automate and transform their networks into self-healing systems to improve the consumer experience.
The banking & financial services sector will hold the second-largest market share. Management of networks is not a simple job for financial institutions. When performing mission-critical nightly processing for numerous branches, in-house IT personnel must commit a significant amount of time and resources to redundant and repetitive tasks. Automation provides banks with a priceless opportunity to beat these hefty processing demands. Automation technology boosts the efficiency of commercial IT operations by around 60 % within the banking industry.
The region-wise segmentation of the global automation market includes North America, Europe, Asia Pacific, Latin America, and Middle East & Africa.
The Asia Pacific and North America Will Dominate the Regional Market
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The Asia Pacific will command the market with the largest share while growing at a CAGR of 25.2%. The rise in 5G investments by essential players in Japan, China, and India, as well as the rise in discretionary income of the populations of developing nations, are anticipated to contribute to the need for automation. The region is expected to have considerable growth in the development and deployment of 5G technology over the projected period due to numerous steps undertaken by telecom companies and government backing. As per the Cisco Annual Internet Report, 2018-2023, this region also has the fastest growth rate in internet penetration. According to the report, the percentage of the area population using the internet in 2018 was 52%, and it is predicted to reach roughly 72% by 2023.
Asia-Pacific manufacturing enterprises are accelerating the digitalization and integration of their operations by providing digital products and services and integrating new technology throughout their organizations. These aspects are anticipated to stimulate the market for network automation.
North America will expand at a CAGR of 20.2% and hold USD 28 billion. The presence of crucial network automation solution providers, such as Cisco, IBM, SolarWinds, VMWare, Extreme Networks, and Juniper Networks, is one of the primary reasons for the region's success. In addition, the region's supremacy in internet penetration and technology use is anticipated to be a primary driver of network automation solution adoption. Significant expansion in the number of connected and mobile devices is driving the increase in demand for better network services. Since North America has always been on the cutting edge of technology adoption, the region has seen the most linked device adoption. These factors are anticipated to be significant growth drivers for the regional industry.
Moreover, the growing number of connected smartphones is giving rise to a wide variety of endpoints, as more users, devices, and applications rely on the network for crucial connectivity, increasing the demand for a dependable network design. To develop self-driving or autonomous networks, enterprises are progressively incorporating advanced management systems, such as artificial intelligence.
List of network automation market companies profiled