The networking industry continues to grow in the first quarter of 2012, according to a series of reports issued by analysts this week.
10GbE take the driver's seat
IDC's Worldwide Quarterly Enterprise Networks Tracker reported that for the first quarter of 2012 the global Ethernet switch market hit $5.1 billion in revenue, a 7.4 percent gain on a year over year (YOY) basis. In contrast, the global router market only grew by 2.8 percent.
One of the bright spots for the switch market is the continued growth of 10 gigabit Ethernet (GbE). According to IDC, 10GbE is now the driver of overall switch market growth. In the first quarter, 2.8 million 10GbE ports were shipped and revenue increased by 20.6 percent YOY.
While there is no shortage of vendors plying their wares in the switch market, Cisco continues to dominate the space overall with a 65.1 percent market share. Cisco's first quarter 2012, Ethernet switch share is a marginal gain of 2.1 percent from the 63 percent reported for 2011. Cisco's share of the fast growing 10GbE segment is even more impressive, coming in at 69.4 percent for the first quarter of 2012.
"The positive market performance in the first quarter of 2012 speaks well to the network infrastructure needs of enterprise IT as it embraces cloud technologies," said Rohit Mehra, director, Enterprise Communications Infrastructure at IDC, in a statement. "While Gigabit Ethernet is alive and well at the network edge supporting a myriad of applications, it is 10GbE along with the emerging 40GbE that will continue to drive incremental growth in datacenter and campus core deployments."
Service provider routers and switches
While the enterprise market for switches is growing, the same cannot be said for the service provider side of the market. According to Infonetics Research's latest Service Provider Routers and Switches report (registration required), the global service provider router and switch market, reached $3.3 billion in the first quarter 2012 revenues for a one percent YOY decline.
Infonetics said that while the global service provider router and switch market declined overall, the North American market was up by nine percent on a year over year basis.
Taking a big picture view, Infonetics reported that the global carrier Ethernet (CE) equipment market had $31.7 billion in 2011 revenues for a 13.4 percent growth rate. CE equipment includes routers, carrier Ethernet switches (CES), and optical gear. Infonetics is forecasting future growth, with CE equipment revenue to top $42.4 billion in 2016.
"Over the five years from 2012 to 2016, operators will spend a cumulative $186 billion worldwide on carrier Ethernet equipment, outpacing overall telecom capex," Michael Howard, principal analyst for carrier networks and co-founder of Infonetics Research, said in a statement. "Every major operator in the world, including BT, Belgacom, Swisscom, Telstra, FT-Orange, Verizon, AT&T, NTT, KDDI, China Mobile, and many others have explicit IP NGN transformation projects going, for which they will use plenty of Ethernet as they gradually replace their legacy SONET/SDH equipment."
Wireless WLAN sales continue steady growth
According to IDC's first quarter 2012 Worldwide Quarterly WLAN Tracker, enterprise sales of WLAN gear grew by 27.2 percent over the first quarter of 2011.
As is the case on wired side, Cisco dominates the global market, with a 52.4 percent market share which is roughly flat with their share last year. Aruba is growing quickly and now holds 11.6 percent of the market, while HP holds a 5.7 percent share.
"The momentum behind bring your own device (BYOD) in the enterprise continues unabated, and is the single largest factor driving enterprise mobility and WLAN market growth," said Rohit Mehra, director, Enterprise Communications Infrastructure, at IDC, in a statement.