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3. Virtual Extensible LAN (VXLAN) Market Size & Share - Top Drivers for Growth

Over the course of the projection period, the VXLAN is expected to increase at a CAGR of 15.0%, from USD 1.6 billion in 2024 to USD 3.2 billion by 2029. The VXLAN industry is primarily driven by the rapid expansion of cloud computing. It is imperative for cloud service providers to provide multi-tenant, scalable environments with dynamic resource allocation in response to demand. With the use of VXLAN, these providers may expand Layer 2 networks over substantial geographic regions, facilitating the smooth migration and segregation of tenant resources both within and between data centers.

The Virtual Extensible LAN (VXLAN) market is expected to experience significant growth in the coming years, driven by several key factors:

• Increased Demand for Scalable Network Segmentation
• Need for Secure Multi-Tenancy in Cloud Data Centers
• Rise of Containerized Applications
• Growth of Network Function Virtualization (NFV)
• Adoption of Software-Defined Networking (SDN)
• High-Performance and Low Latency
• Expanding Internet of Things (IoT) Landscape

To know about the assumptions considered for the study download the pdf brochure

Increased Demand for Scalable Network Segmentation:

Traditional VLANs (Virtual LANs) have limitations on the number of segments they can support. VXLAN overcomes this by leveraging MAC addresses and VXLAN headers to extend Layer 2 segmentation across Layer 3 networks. This scalability is critical for modern data centers with growing workloads and diverse network needs.

Need for Secure Multi-Tenancy in Cloud Data Centers:

Cloud data centers often host multiple tenants, each requiring secure isolation of their network traffic. VXLAN facilitates this by creating isolated overlay networks within the shared physical infrastructure. This enables secure multi-tenancy and efficient resource utilization for cloud service providers.

Rise of Containerized Applications:

Containerization is a popular approach to deploying and managing applications. Containerized applications are portable and lightweight, but they can also create challenges for network management. VXLAN simplifies network management for containerized environments by providing granular control over network traffic.

Growth of Network Function Virtualization (NFV):

NFV is the concept of virtualizing network functions traditionally performed by dedicated hardware appliances. VXLAN plays a vital role in NFV by enabling the creation of virtual network services (VNS) that can be dynamically deployed and scaled across the network.

Adoption of Software-Defined Networking (SDN):

SDN allows for centralized control and programmability of network resources. VXLAN integrates well with SDN, enabling automated network provisioning and management of overlay networks.

High-Performance and Low Latency:

VXLAN is designed to be performant and introduce minimal latency to network traffic. This is crucial for applications that require real-time responsiveness, such as online gaming, video conferencing, and financial trading.

Expanding Internet of Things (IoT) Landscape:

With the growing number of interconnected devices in the IoT landscape, network management becomes increasingly complex. VXLAN can help manage and secure the vast amount of data generated by IoT devices by enabling segmentation and isolation of specific types of traffic.

Virtual Extensible LAN Market Share - Global Industry Landscape

The leading companies in the Virtual Extensible LAN industry and their key offerings include:

• Citrix Systems (US)
• Keysight Technologies, Inc. (US)
• Red Hat (US)
• Pica8 (US)
• Arrcus (US)

It's important to note that this is not an exhaustive list, and the VXLAN landscape is constantly evolving. When choosing a VXLAN solution, consider your specific needs, budget, and existing network infrastructure to find the best fit from these leading companies.

Citrix Systems (US):

• Market Share: While Citrix doesn't exclusively focus on VXLAN, it offers network virtualization solutions like NetScaler SDX that might leverage VXLAN for certain functionalities. It's difficult to pinpoint a specific market share for Citrix in the VXLAN space due to this broader product portfolio.
• Key Offerings: Citrix's network virtualization solutions can be relevant for VXLAN deployments in data centers, potentially providing features like:

Keysight Technologies, Inc. (US):

• Market Share: Keysight is not a primary player in the VXLAN market. They are a leading provider of electronic test and measurement equipment.
• Key Offerings: Keysight's offerings are not directly related to VXLAN solutions. They focus on test and validation tools used in various industries, including network equipment testing.

Red Hat (US):

• Market Share: While a specific market share for Red Hat in VXLAN is difficult to isolate, Red Hat stands out as a major player due to its prominent role in software-defined networking (SDN).
• Key Offerings: Red Hat's OpenStack cloud platform is a key offering. OpenStack leverages VXLAN for creating and managing virtual networks within data centers. This makes Red Hat a significant indirect player in the VXLAN market.

Pica8 (US):

• Market Share: Pica8 is a smaller player in the VXLAN market compared to network giants like Cisco or VMware. However, they offer VXLAN-specific solutions. Determining a precise market share might be challenging due to their niche focus.
• Key Offerings: Pica8 specializes in VXLAN overlay network solutions. They offer products like the VXLAN Manager and VXLAN Analytics that cater specifically to VXLAN deployments. These products might focus on:

Arrcus (US):

• Market Share: Similar to Pica8, Arrcus is a smaller player in the VXLAN space but focuses on VXLAN-centric solutions. Obtaining a specific market share might be difficult.
• Key Offerings: Arrcus offers a cloud-native network operating system (Arcus Arc) that incorporates VXLAN for multi-tenant networking and workload mobility across cloud and bare-metal environments. Their key offerings might include:

Related Reports:

Virtual Extensible LAN (VXLAN) Market by Offering (Hardware, Software, Services), Application (Software-Defined Networking Overlays, Network Function Virtualization), Vertical (Manufacturing, BFSI, Healthcare) and Region - Global Forecast to 2029