Microsoft a dark horse contender as SASE revenue tipped to hit $8B in 2023: Dell’Oro

Secure Access Service Edge (SASE) sales chugged along in Q3 2022, jumping more than 25% year on year and setting the segment up to hit $6 billion in revenue for the full year, new data from Dell’Oro Group showed. Mauricio Sanchez, the firm’s research director for Network Security, SASE and SD-WAN, told Fierce that robust pace of growth is expected to continue into 2023, despite macro-economic conditions that have many worried about a recession.

Dell’Oro predicted SASE market revenue will jump by another $2 billion to reach $8 billion in 2023, doubling the $4 billion it raked in just two years prior in 2021. The analyst company previously forecast the overall SASE market will grow to $13 billion by 2026.

Asked whether a recession might slow growth in the segment, Sanchez said “the short answer is not really,” at least in the case of the mild recession that is expected. That’s because “the need to secure hybrid work and cloud applications is white hot,” he explained.

In terms of what players he’ll be watching in 2023, Sanchez pointed to Cisco, Fortinet, Palo Alto Networks, Symantec/Broadcom, Versa Networks, VMware and Zscaler. But in an interesting turn he mentioned one other company not typically associated with SASE: Microsoft.

“The dark horse is Microsoft. Not a significant player today, but could easily become one virtually overnight,” he said. "Microsoft – Windows, Azure – has all the technology elements to not only do SASE but compete on a number of other fronts: identity management, firewalls, email/content security, WAF, DDoS, endpoint, cloud security, cloud networking. Moreover, Microsoft has been beating the drum louder about their security capabilities and desire to go after share of security wallet."

The firm breaks SASE down into two primary buckets: security (SSE) and networking (SD-WAN). Of the two, Sanchez said SSE has been growing faster. He also noted unified SASE implementations, which include both the SSE and SD-WAN capabilities in a single package, are gaining ground on disaggregated deployments.

“The majority of SASE market consists of disaggregated solutions, with only a small portion – a bit over 10%  –  being unified. Though smaller on absolute basis, unified implementations are growing much faster – about 7 to 1 ratio,” he explained. “Today, I only see Aryaka, Cato Networks, Versa Networks and VMware fitting the bill [as unified solution vendors]. However, I expect that there will be more over time.”