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Enterprises consider NaaS adoption for business agility

As enterprises accelerate toward digitization of their complete IT stack, NaaS -- which can lower costs, increase QoS and improve business agility -- has become a viable option.

Some of the top digital transformation trends for 2023 include AI, automation and cloud. Network as a service, or NaaS, only recently emerged in the enterprise market, but it has become the latest networking trend expected to take off in the next few years. Despite tepid adoption rates in 2022, Gartner reported 15% of enterprises will adopt NaaS by the end of 2024.

Organizations that want to avoid the burden of owning and managing their network infrastructures can purchase NaaS, a subscription-based platform of network hardware, software and resources, packaged into a single service. The tradeoff is organizations turn over control of their networks to third-party providers. But service-level agreements (SLAs) guarantee quality of service (QoS), higher uptime and increased security. NaaS can help improve business agility, said Chris Grundemann, managing director at Grundemann Technology Solutions, in a recent webinar.

Grundemann, along with Ken Gray, senior director of market research and analysis at PacketFabric, discussed how NaaS adoption is accelerating because it combines automation, the as-a-service model and general network capacity to create WAN agility and support business agility.

The network is a fundamental aspect of IT infrastructure. When the network is down, it affects the entire business, Grundemann said. Previous methods of network management weren't suitable at handling several quick changes, Grundemann said. But NaaS adds the necessary level of flexibility to the network.

Interest in NaaS increases across enterprises

NaaS first emerged in the mid-2010s. But, as Gartner reported in its 2022 Magic Quadrant report on enterprise wired and wireless LAN infrastructure, it wasn't until the last 18 months that NaaS platforms hit the enterprise market. NaaS emerged during a time when enterprise networks underwent two significant shifts.

First, the move to hybrid work contributed to the complication of enterprise network management. Network teams needed to manage thousands of endpoints distributed across their organizations, and network professionals began to think about how they could restructure their networking environments, Gray said.

When we get into a period of digitization, we get into a lot of unpredictability -- new projects, new locations, new bandwidth, new data associations. The old way of wide area networking can't keep up with that.
Ken GraySenior director of market research and analysis, PacketFabric

NaaS also became a viable option with the rise of digital transformation. As organizations started to innovate other areas of business operations, NaaS became an advantageous way to modernize the traditional enterprise network to support new business demands.

"When we get into a period of digitization, we get into a lot of unpredictability -- new projects, new locations, new bandwidth, new data associations," Gray said. "The old way of wide area networking can't keep up with that, even though the organization itself has already moved into that space."

NaaS delivered through a consumption model

The use cases and heightened interest in NaaS aside, Gartner reported current NaaS adoption rates are around approximately 2%. Most NaaS providers currently offer managed service offerings, which could account for the inactivity of NaaS adoption. According to Gartner, NaaS providers and vendors offer per-box consumption equipment, rather than as-a-service consumption equipment, which is necessary for true NaaS offerings.

A NaaS consumption model provides quick fulfilment for network services, Gray said. In traditional enterprise networks, organizations needed to reach out to their MSPs if they needed to implement changes in their networks.

With the consumption model, NaaS operators have the capacity and resources to manage networks, and they fix problems in the network rather than the organization's in-house network team. Gray added that, because NaaS platforms are cloud-native, providers place less priority on scale or high availability because NaaS providers periodically implement changes and update their customers' networks.

A subscription-based consumption model offers a fixed and recurring cost, often monthly. This cost is lower than the costs of managing a traditional on-premises network because organizations outsource management to third parties. Consumption models also typically operate on a pay-for-what-you-use basis, which means organizations only need to pay for the capacity they need and overall network management costs decrease.

Self-service: An essential feature of NaaS

When organizations adopt NaaS, they essentially transfer ownership of their network to the NaaS provider. Grundemann described this as a move from ownership to access. Gray added this move can be liberating for organizations because it simplifies network management. However, this strategy doesn't mean organizations rely solely on service providers to make changes to the network.

The self-service feature of NaaS enables organizations to make changes to their networks, even though they don't own the infrastructure. Network professionals can administer most changes themselves, like orchestrating workloads or moving bandwidth, with the touch of a button, Gray said.

Self-service is an important aspect of NaaS, Grundemann said, because, without it, the consumption model becomes like the previous MSP model. Self-service supports both customers and operators, Gray said, because having this form of autonomy enables customers to improve functionality, while saving operators operational costs.

Future of NaaS

Several factors contribute to the increased interest in NaaS adoption across enterprises. For one, according to Gray, NaaS can provide the agility, privacy and SLA guarantees that many organizations desire. Grundemann also added that traditional enterprise networking has developed into a broader ecosystem.

An enterprise network is no longer a collection of multiple networks and resources scattered across one organization. Enterprise networks now connect an organization's network to other data centers, partner networks, applications, the cloud and other distributed systems, Grundemann said. NaaS can simplify this connectivity.

"Having access to that ecosystem is important," Grundemann said. "It's one of the reasons why NaaS is gaining so much traction so fast. People realized they need this network connectivity to all these different players."

NaaS adoption will likely increase by 2024. But, like most trends in networking, the shift won't happen immediately. Enterprises will need to make the transition from an on-premises network to a cloud-native networking strategy, and it might take some organizations longer than others. Enterprises that adopt NaaS could gain support from a third-party provider, as well as benefit from cost savings, privacy and improved QoS, among other benefits that support ever-evolving enterprise networks.

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