AT&T is partnering with VeloCloud to bring software-defined WAN capabilities to its growing software-centric networking efforts.

AT&T is the latest carrier to partner with a networking vendor to offer SD-WAN services on their networks, enabling organizations to more quickly and efficiently route traffic across their wide-area networks by giving multiple transport options and automatically choosing the best path.

SD-WAN is part of the larger network virtualization movement that also includes software-defined networking (SDN) and network-functions virtualization (NFV), and is gaining interest from enterprises that are looking to move from hardware- to software-based networks in order to better address the increasingly cloud-centric world.

"Businesses need to satisfy increasing bandwidth demands while reducing costs," Rick Hubbard, senior vice president of network product management at AT&T, said in a statement. "That means network needs are evolving, too. This initiative is part of our software-centric strategy that gives our customers more flexibility and control of their networking services."

VeloCloud brings software products that run on x86 systems in a customer's branch offices or remote sites as well as in the cloud by connecting to VeloCoud Gateways housed in cloud data centers worldwide run by Amazon Web Services, Equinix and other service providers. The gateways ensure that applications and workloads are delivered via the most optimized data paths and enable network services to be delivered from the cloud. VeloCloud Edge appliances at the remote and branch sites provide secure connectivity, performance metrics, virtual network functions (VNF) hosting and quality-of-service (QoS) capabilities, and centralized management is provided by VeloCloud Orchestrator.

AT&T officials said the carrier also will partner with other SD-WAN providers in the future to give customers more options.

The SD-WAN space is a highly competitive area that is populated not only by established players like Cisco Systems, Riverbed Technology and Citrix Systems, but also a range of smaller companies, such as Silver Peak, Aryaka, Talari Networks, VeloCloud and Glue Networks. Gartner analysts are predicting that while about 1 percent of enterprises currently are using SD-WAN technology, the number will increase to 30 percent by the end of 2019. IDC analysts expect the market to grow to more than $6 billion by 2020, up from less than $225 million last year.

The WAN traditionally has relied on such connectivity protocols as Synchronous Optical Network (SONET), Asynchronous Transfer Mode (ATM) and Multiprotocol Label Switching (MPLS), which arose at a time when data was relatively static and traffic primarily traveled between the remote office and the central data center. Now, applications and workloads move between the branch office and the cloud, and data can come from a broad array of mobile devices. SD-WAN offers the ability to run traffic over multiple modes, including expensive MPLS and more affordable, newer alternatives, and to be able to manage it all centrally with such features as zero-touch and traffic prioritization capabilities.

Other carriers and service providers also are embracing SD-WAN. Verizon late last year announced it was using Cisco's iWAN technology for a service that enables customers to run their own SD-WAN environments on-premises, a move that officials called the carrier's first real step into the overall SDN world. Several months later, Verizon officials brought on Viptela as another SD-WAN option, giving enterprises a choice of hosting their own SD-WAN clouds or using technology housed on the carrier's cloud.

Both Earthlink and MetTel turned to VeloCloud to partner on SD-WAN, while BT Group is partnering with Cisco. CenturyLink also offers SD-WAN services.

AT&T officials said the carrier will offer network-based and over-the-top (OTT) hybrid SD-WAN solutions starting later this year.

The SD-WAN offering is part of AT&T's Network on Demand initiative to use SDN and NFV to drive a software-centric approach to its infrastructure. AT&T officials expect that by 2020, 75 percent of the carrier's network will be virtualized.