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Global Ethernet and Router Switch Markets Show Mixed Results in 3Q18

Monday Dec 24th 2018 by Sean Michael Kerner

100 and 25 Gigabit Ethernet demand is pushing the switch market forward.

One of the best indicators of the current state of the networking market comes from IDC's quarterly trackers for the switch and router markets.

In the third quarter of 2018, IDC reported somewhat mixed results in its trackers, showing gains in switching and declines in routing. For the quarter, the global market for Ethernet routers reported $3.7 billion in revenue for a 5.1 percent year-over-year decline. In contrast, the global Ethernet switch market grew by 8.1 percent, to $7.3 billion.

The decline in the global router market was primarily driven by a downward trend in the service provider segment, which is where most of the router market revenues come from. Service provider router revenues declined by 7.3 percent, while in the enterprise router segment, revenues actually grew by 2.5 percent.

100 GbE Growing Fast

Among the drivers of growth for switching worldwide has been the rapid expansion of 100 Gigabit Ethernet (100 GbE). According to IDC, 3.5 million 100 GbE ports were shipped in the third quarter of 2018, for a 154.6 percent year-over-year gain. From a revenue perspective, 100 GbE now accounts for 14.8 percent of total switch market revenue. 100 GbE revenues for the third quarter were reported at $1.1 billion, marking the first time 100 GbE has crossed the $1 billion threshold.

Demand for 25 GbE is growing even faster than 100 GbE. IDC reported that 2.6 million 25 GbE ports were shipped in the quarter for a 251 percent year-over-year gain. 25 GbE now accounts for approximately 3.7 percent of the total revenue for the global switch market.

The majority of market revenue continues to come from 1 GbE, at 42.3 percent of total revenue. In the third quarter, IDC reported, 116.4 million 1 GbE ports were shipped for an 8.4 percent year-over-year gain. 10 GbE port shipments rose by 16 percent, now accounting for 28.8 percent of the market's revenue.

"While hyperscalers and cloud service providers are pushing consumption at the high end of the switching market, there remains strong growth in the enterprise campus and lower speed switching platforms too, highlighting the increased demands of the network from organizations of all sizes," Rohit Mehra, vice president, Network Infrastructure, at IDC, wrote in a media advisory.

Vendors

Cisco continues to lead the overall global switch market with a 54.4 percent revenue share, while Huawei holds down the number two slot at 8.6 percent. Coming in third is Arista Networks with a 6.6 percent share, which has been growing thanks to the company's strong focus on 100 GbE technologies.

IDC Ethernet 3Q18

Sean Michael Kerner is a senior editor at EnterpriseNetworkingPlanet and InternetNews.com. Follow him on Twitter @TechJournalist.

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