NEC Collaborates with UniKL to Gain an Early Advantage in the Malaysia SD-WAN Market

A. Amir

Summary Bullets:

  • NEC completed its SDWAN trial with UniKL and was selected as the technology partner for the university’s SDx Center of Excellence.
  • While the collaboration offers an early-mover advantage, NEC needs to expand its ecosystem of partners to grab the bigger market opportunity in the country.

NEC Corporation announced the completion of its SD-WAN trial with the University of Kuala Lumpur (UniKL) in Malaysia on March 22, 2019. The initiative, which was funded by the Japanese government, used NEC’s own solution, ‘SD-WAN Security Common Platform,’ and covered several use cases such as virtualization and monitoring of end-to-end network traffic in multivendor environments, dynamic routing optimization based on application requirements, and central configuration of network switches across the university campuses. Following the successful collaboration, NEC has also been selected as the technology partner for UniKL’s newly launched SDx Center of Excellence, which brings together industry experts and researchers to co-develop solutions based on the latest networking technologies such as SDN, IoT, and 5G.

SD-WAN in Malaysia Is Still in an Infant Stage

While SD-WAN is already gaining its traction globally, the technology is still at a very early stage in Malaysia. There is a significant supply-demand gap in the market. The service is still limited in Malaysia and only offered by a small number of providers (e.g., Netpoleon, RedTONE) despite the growing demand from local enterprises. As more workloads are migrated from on-premises to cloud environments, the bandwidth requirements are increasing while the network dimensioning between branches, data centers and the cloud is changing. The network needs to be agile to reflect this trend. Hence, the case for SD-WAN service is getting more tangible. GlobalData research shows that 60% of Malaysian enterprises selected SD-WAN as one of their technology priorities (compared to 56% for Ethernet and 52% for MPLS) while 10% of the total network and communications budget was allocated for the technology.

NEC Taking Advantage of the Slow Market

While NEC may not be the first name that comes to mind when thinking about SD-WAN vendors, the collaboration with UniKL (the trial and the SDx Center of Excellence) offers an early-mover advantage to grab the initial opportunity and drives the company’s brand share in the country’s SD-WAN market. The trial enables NEC to understand the landscape of the underlying connectivity in the country and tailor its solutions accordingly to address the market. Participation in the university’s SDx Center of Excellence provides the company with access to local service providers, system integrators, and enterprises. This also offers the company a platform to strengthen its ecosystem partner and go-to-market strategy.

Partnership with Carriers

The partnership with UniKL is a good start for NEC. It also needs to expand its channel partners, especially with domestic carriers such as Telekom Malaysia, Time, Maxis, and Celcom. With network capabilities and as existing connectivity service providers, carriers often have the upper hand to offer SD-WAN in the market. However, apart from Telekom Malaysia and RedTONE (a small telco targeting a niche market), the others are yet to offer SD-WAN services commercially. NEC should consider trials with the carrier to understand the network capabilities, focusing on the integration between its SD-WAN solution and the underlying infrastructure as well as other features such as security and virtual network functions (VNFs). It should also collaborate with the carriers to build managed service capabilities and co-create managed network solutions that address not only the IT needs, but also the business requirements from other LoBs.

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