Network sales are forecast to become a SaaS & NaaS operating model, i.e., licensing. The argument is confusing to the community of experts. For the past 30 years, the earnings logic has been based on equipment sales and maintenance for manufacturers, wholesalers, resellers, and service providers. Our generation loves equipment and its operation. Many still believe new devices and cloud management are the answer to building modern networks. However, I argue that the enterprise network will become a SaaS service.

How on earth can a network be implemented without physical devices?

Easy, but the transition is gradual, reducing stand-alone devices and solutions. The transition to the market has begun with the migration of on-premise functions (authentication, access control, firewall, content filtering, data security, etc.) to the cloud and the transition to software-based solutions.

For example, implementing an SD-WAN corporate network and IoT private network without physical, virtual, or even cloud NGFW or SD-WAN network devices is easy and affordable for many small businesses. In the end, a corporate network is just a virtual (logical) network that you want to work with everywhere. The virtual network is complemented by cloud-based SaaS security services as needed.

The current “ecosystem” is based on the equipment manufacturer’s brand, equipment distribution, and channel model. The supply and marketing of device-based solutions are so massive that it is difficult for a customer company to question the solution sense. However, there are many options. The ease of managing these new SaaS services without significant investments will create opportunities for even smaller IT service providers to compete in the corporate network market of the future.

An enterprise network is a virtual network.

Most medium and large companies have acquired a private network service from a telecom operator based on MPLS technology. Such a corporate network is virtual but inflexible for the customer. The configuration and management of a virtual network are based on physical sites and devices (backbone, access, and CPE routers) and IP subnets. The ultimate idea is to place services, devices, and users on this virtual (logical) network, either physically or through VPN Client software.

An SD-WAN (overlay) over the operator’s physical network is seen as a more flexible enterprise solution. With the SD-WAN solution, companies are looking for faster and more flexible change management and direct Internet routing to cloud services. Compared to an MPLS network, a logical SD-WAN network is not tied to a single operator and the operator’s physical network equipment and configuration.

The enterprise network becomes a SaaS service.

In practice, we need some essential network services and network equipment. The workstation connects to a wireless network (Wi-Fi or Cellular 4G / 5G access point) or an Ethernet switch port. Optical network devices and routers are required for the operator’s backbone and local area network. Admittedly, carrier routers can be software only with the SaaS model instead of a physical device.

Traditional on-premise enterprise solutions such as identity management, strong authentication, NGFW firewall, access control, security threat checking and filtering, remote application access, intrusion prevention, terminal security management, etc., are moving to the SaaS model. In this model, the end customer does not need to worry about infrastructure. As a business model, it is leasing a software license to the customer.

The cloud-based SASE architecture most often uses physical or virtual SD-WAN devices to create a virtual corporate network. In addition, the solution includes workstation software to connect the remote user to the company’s virtual network. Thus, there is still too much hardware in the SASE architecture, even though the software is at the center. However, this is not the only option for implementing a virtual corporate network.

A company can implement a virtual network 100% software-based by connecting a workstation, mobile, and IoT hardware. This way, your company’s employees and devices are in a virtual corporate network, regardless of location, operator, or connectivity technology. In the absence of network equipment, the solution is inexpensive and flexible. No need for spare equipment and equipment management, no need to worry about equipment delivery times, and best of all, security and its management are not tied to a physical network device, location, or even IP addresses. Enterprise network will become a SaaS service.


Hannu Rokka, Senior Advisor

5Feet Networks Oy