GTT Communications is banking that yesterday's deal to buy Global Capacity will make it a major player in the SD-WAN sector.
According to a story by Light Reading's Carol Wilson, editor-at-large, GTT Communications Inc. CEO Rick Calder's decision to buy Global Capacity was based on the addition of a large footprint of last-mile edge connectivity to pair with GTT's current SD-WAN offerings for cloud connectivity. (See Diversity & SD-WAN Drive GTT-Global Capacity Deal and GTT to Buy Global Capacity .)
The $161 million cash and stock deal, which is expected to close by the end of the third quarter, brings more access options, including Ethernet-over-Copper connections, into GTT's SD-WAN stable that was already comprised of cable, LTE and fiber.
"That positions us well with respect to SD-WAN, where clients want multiple different diverse paths that can be managed through a software layer," Calder said to Wilson. "We think the combination of that last-mile edge with our Top 5 Internet backbone network, which connects seamlessly to any cloud service with very little latency, positions us to be incredibly disruptive in the SD-WAN marketplace."
With the addition of Global Capacity , GTT expanded its reach into 41 data centers and 1,750 central office points-of-presence (PoPs) as well as new customers in the healthcare, application service provider, retail and carrier verticals. Both companies, which were competitors, previously announced that they were working with VeloCloud Networks Inc. as their SD-WAN vendor.
Like many other communications service providers, GTT has seen the writing on the wall in regards to SD-WAN. According to a recent report by 451 Research -- for Cato Networks -- SD-WAN deployments will increase 200% year-over-year. Jim Duffy, senior networking analyst at 451 Research , said that despite the big increase in deployments that the SD-WAN sector would go through some growing pains.
"IT practitioners are still ironing out the wrinkles when it comes to SD-WAN," Duffy said in a press release for the report. "The technology offers streamlined management and increased network agility, but its cost reduction impact is constrained by the need for increased security and the continued reliance on MPLS. The scope of SD-WAN is likely to expand to address these constraints and enhance customers' return on investment."
— Mike Robuck, Editor, Telco Transformation