Network Access and Monitoring appliances, or what the market has now christened Network Packet Brokers (NPBs), are currently the hottest sector of the network appliance market since the 1990s dot-com explosion.

Last summer saw the successful IPO and billion dollar valuation of Gigamon. Net Optics was picked up a month ago for $190 million in cash by Ixia, following their May 2012 acquisition of Anue. The last couple of years has also seen the acquisition of the following players in this space; VSS by Danaher (June 2012) and Simena and Onpath by Netscout (November 2011 and November 2012).

Why all this fuss? The network access and monitoring market is set to explode over the next three years, growing from its current valuation of $350M to over $1B, according to independent forecasters, such as Frost & Sullivan. However, figures like these no longer set the pulse racing in Silicon Valley. The following six factors explain why this sector will continue to sizzle to the end of this decade and beyond.

• Network Scalability

To meet the constant growth in traffic, the networking world is rapidly scaling from 1Gbps to 10Gbps networks. Large telcos and enterprises have already, or are contemplating, moving to 40Gbps and 100Gbps. However, most companies have invested heavily in network security devices and a myriad of different monitoring tools that can only function at 1Gbps. Does this mean these companies should throw away tools that they’ve had for just a few years and buy 10Gbps tools? How long would it be before they have to discard the 10Gbps tools in favor of 40Gbps or 100Gbps tools?

To protect massive investments in 1Gbps security and monitoring tools, companies are using NPBs to act as the “middleman” between the network and tools. This requires NPBs to utilize features, such as load balancing and filtering to either distribute the 10Gbps load across multiple 1Gbps tools or selectively filter the specific traffic off the 10Gbps network before sending it to the 1Gbps tool.

This requirement for a “broker” to facilitate the interconnection of networks and tools is not going away anytime soon. In fact, it will continue to gather pace as higher speed network migrations continue to evolve.

• Security & Compliance

It doesn’t require a crystal ball to realize that network security investment is going in one direction. The emergence of recent hacking scandals, whether it be the Associated Press website or Target’s customers’ credit cards, are causing companies to reassess security measures, ultimately leading to increased sales of security devices that are connected to the network. Following the Snowden incident, many of these devices are focused on data loss prevention (DLP) – monitoring what’s leaving the company’s network while preventing hackers/malware/viruses from entering the company’s network.

Whether it’s financial services (Dodd Frank), utilities (NERC and FERC) or healthcare (COSHA, HIPAA), growing data compliance requirements by the Federal Government and industry regulators are driving additional network monitoring devices to meet these compliance mandates. Many devices need to be deployed in compliance-heavy environments where there is not a lot of technical expertise available. Hence, monitoring tools should be easy to setup, configure and deploy.

The always-on nature of the world means that devices need to be connected to the network via NPBs that can detect when a firewall, or other in-line device, has failed and automatically failover to a redundant device without impacting the network. Deploying NPBs that can be set up in active and standby mode can also enable hardware and software maintenance to be carried out without requiring a maintenance window or risking network impact.

• Monitoring the Cloud

The business world is getting more comfortable with putting increasing amounts of key business applications into the cloud. As this trend continues, there will be increased demand for cloud service providers to monitor these services to ensure customers’ service level guarantees (SLGs) are met and the service being paid for is adequately delivered.

On the flip side, customers of cloud services will inevitably “trust but verify” by conducting their own monitoring. This “trust but verify” mentality will undoubtly increase the number and sophistication of NPBs at various ingress and egress points of the cloud.

• Mobility

Most companies are under pressure to adopt bring your own device (BYOD) strategies to support the multitude of different smartphones, tablets, laptops and other devices. This means embracing multiple mobile operating systems each with their own security vulnerabilities. Most company CIOs would confess that mobile devices accessing corporate networks present their biggest security challenge.

In order to get a handle on the mobile aspect of running large networks, deploying NPBs as the gatekeepers allows organizations to monitor the boundary layer between the mobile and fixed world. Only then can you effectively collect, monitor and analyze data to determine what’s going on at the interface of these two worlds.

• Monetization of Social Media

Service providers are realizing that social media content that flows across their networks contains data that, if accessed, analyzed and presented correctly, is worth billions of dollars of incremental revenue.

Web 2.0 companies, or large service providers, can capture social media commentary on new product releases, advertising campaigns or brand launches by deploying NPBs and analytical tools. This provides consumer feedback with an immediacy and accuracy from targeted markets that challenge traditional means of evaluating media content.

The business opportunity of being able to monetize this data is so big that large service providers are currently looking at investing huge sums on effectively deploying NPBs throughout their networks to collect and channel this data back to “big data” analytical engines to crunch the data into meaningful, actionable business intelligence.

• Gateway to Software Defined Networking World

The most tantalizing of all the factors driving interest and M&A activity in the network access and monitoring space is the prospect of it being a gateway to the new world of software defined networking (SDN).

SDN promises to deliver for the network world what virtualization has delivered for the data center server environment; the ability to move VMs, with different operating systems and applications running on them, around and between data centers without worrying about the underlying infrastructure.

In order to achieve such a network, you need know what’s happening at all times on the network in terms of bandwidth allocation, protocol performance, response times, etc. This data then needs to feed into the software’s “orchestration layer” that can initiate the necessary changes to keep network applications running smoothly.

NPBs sit in the perfect position to collect and provide the orchestration layer within SDN network architecture the intelligence it needs to work with Openflow controllers and other SDN building blocks to create a “virtualized network environment”.

A year ago, a website review of the top players would have resulted in a struggle to find SDN even mentioned. Now they are all staking claims as to why their product provides the key piece of the SDN puzzle.

Summary

Any one of the six factors above would be enough to make people think twice about ways to improve their network monitoring efforts. When you combine the first five together with number six, there’s no ignoring the fact that the space is getting hot, in fact, it’s sizzling!

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About the Author

John Gill is the vice president of sales for the Americas at Network Critical, where he is responsible for leading revenue growth and establishing the company in the network access solutions market. Having spent more than fifteen years in senior sales positions, John is a highly experienced sales leader within the telecommunications industry. Prior to joining Network Critical, John was sales director for service providers at Brocade, and before that he managed sales teams for Cisco Systems. John received his Master’s degree in Telecommunications Engineering from the University of Colorado at Boulder.

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