SD-WAN supplier Aryaka announced today a partnership with telco China Mobile International (CMI), claiming to be "the first fully compliant global SD-WAN service for international companies with locations in China, and Chinese companies with global presence."
Last summer, Bloomberg Technology reported that the Ministry of Industry and Information Technology (MIIT) in China would be cracking down on unauthorized VPN traffic in China by February 2018, requiring China Mobile, China Unicom and China Telecom to block individuals' access to VPNs. Network World later reported that these regulations were scheduled to be enforced as of January 11, but it's unclear to what extent these regulations are being enforced and if the MIIT is now actively blocking SD-WAN traffic in China as a result. (See SD-WAN Supplier Aryaka Partners With China Mobile International.)
What do these increased VPN regulations mean for SD-WAN companies with service deployments in China?
"The MIIT regulations pose quite the challenge for SD-WAN companies as they need to have a direct relationship with one of the big three operators in China to be compliant. That is China Telecom, China Mobile and China Unicom," explains Zeus Kerravala, founder and principal analyst for ZK Research, in an email to Light Reading. "It's certainly not good for competitive operators in China."
In an interview with Light Reading, Gary Sevounts, CMO of Aryaka , says the SD-WAN supplier has received forwarded letters from customers "where there were clear indications that the law would start being enforced. The challenge is a lot of SD-WAN solutions either don't have partnerships with authorized providers or those are just regional [SD-WAN deployments]. There is no global SD-WAN solution besides Aryaka that is compliant with the regulations in China and can be deployed by both global companies into China, and providing connectivity for Chinese companies going outside China."
Essentially, any SD-WAN service has to be delivered by one of these three main telecom providers in China, which means SD-WAN suppliers that aren't partnered with one of these operators risk their services being blocked, says Kerravala.
"All the other SD-WAN solutions available in China are not in compliance, they may work but they could be blocked sometime between now and in the near future," says Kerravala. "As far as I know, Aryaka is the only vendor with a compliant solution."
According to Aryaka, China Mobile Ltd. (NYSE: CHL) will deliver its SD-WAN services to businesses with both headquarters in China and international locations, and provide foreign companies with a regulatory compliant SD-WAN service supporting their locations in China. Sevounts says China Mobile will resell Aryaka's SD-WAN service within China and the two companies "will work together on the global SD-WAN piece."
Shehzad Karkhanawala, director of marketing for Aryaka, says Chinese companies with international presence as well as global businesses doing business in China can experience significant performance and productivity improvements by making use of Aryaka's SD-WAN service. For example, a 100KB file sent over public Internet between San Jose and Shanghai takes 3,970 milliseconds or nearly 4 seconds to load, says Karkhanawala. For customers on Aryaka's SD-WAN service, that download time is reduced tenfold to 306 milliseconds, he says.
— Kelsey Kusterer Ziser, Senior Editor, Light Reading