Worldwide, overall Ethernet switch revenue rose 4 percent sequentially and 5 percent year-over-year (YoY) in 3Q 2014 to reach $5.6 billion, according to Infonetics’ latest quarterly “Ethernet Switches” report. Demand from the public and financial services sectors fueled growth.
Growth for different segments of the Ethernet switch market varied widely as telecom providers, data center operators, institutions and large enterprise businesses race to keep up with burgeoning network traffic and end-user demand. Introduction and uptake of a new generation of Ethernet switches is also having an impact on shifting growth in revenues across the market.
Sub-segment Forecasts Vary
While revenues for unmanaged and chassis Ethernet switches declined in 3Q, those for Web-managed and fully-managed fixed switches posted double-digit growth, Infonetics’ latest report reveals. Shipments of 10GE port Ethernet switches rose 26 percent YoY, below expectations “at this stage in the adoption cycle,” however, Infonetics noted.
Newer 40GE switches are taking over from 10GE switches as the market’s growth leader, according to Infonetics. Shipments of 40GE switches more than doubled YoY in 3Q, “with growth especially strong in the white-box market,” the market research company highlighted.
Another step up in bandwidth, demand for 100GE switches slowed after posting strong growth in 2Q, but Infonetics expects growth will pick up again in 2015 given “introduction of lower-cost optics.”
Commenting on its latest research results, Infonetics’ Directing Analyst for enterprise networks and video Matthias Machowinski stated: “Recent momentum in the Ethernet switch market carried through to the third quarter, and 2014 is on track for record revenue.
“Looking ahead, we expect growth to accelerate, thanks in part to the introduction of 2.5G and 25G Ethernet. These new Ethernet speeds will be a premium offering relative to 1GE and 10GE to address bandwidth constraints in data center and campus networks, and should provide an additional boost to revenue.”