SOURCE: Infonetics Research

February 21, 2006 14:11 ET

$19 Billion Spent on Enterprise Routers and Switches in 2005; Will Near $25B Mark in 2009

BOSTON, MA -- (MARKET WIRE) -- February 21, 2006 --The worldwide layer 2 and layer 3 Ethernet switch market blew past the $15 billion mark in 2005, growing 9% from 2004 to $15.3 billion, and the layer 4 through 7 switch market grew 26% to reach $750 million, according to Infonetics Research's latest L2-L7 LAN Switches report.

Together, worldwide L2-L3 Ethernet switches and L4-L7 switches are forecast to grow 27% between 2005 and 2009, topping $20.3 billion, with port shipments growing faster due to price declines, especially for faster speed switches.

As Infonetics reported last week from its Enterprise Routers report, enterprise router revenue was up 6% for the quarter but down 3% for the year, from $3.4 billion to $3.3 billion between 2004 and 2005, due to price pressure. Despite the dip in revenue, enterprise router units grew 14% in 2005, indicating continued strong demand.

Annual router unit shipments are forecast to grow 41% between 2005 and 2009, passing the 2 million unit mark in 2007, with revenue growth close behind, growing 37% to $4.5 billion in 2009.

"As organizations continued to build out and upgrade their aging infrastructure, they spent more than $19 billion on enterprise routers and switches last year," said Matthias Machowinski, directing analyst at Infonetics Research. "Overall, the market for enterprise networking gear remains healthy, with Ethernet switches doing particularly well."

Switch Highlights

--  273 million L2-L3 Ethernet switch ports were shipped worldwide in
    2005, 20% more than the year before
--  Worldwide L2-L3 Ethernet switch revenue was up 4% for the quarter, to
    $4.1 billion, and ports were up 7%
--  L2-L3 PoE port shipment growth picked up again, with ports up 16% in
    4Q05
--  Worldwide L4-L7 switch revenue jumped 19% between 3Q05 and 4Q05 to
    $215 million, (28% higher than 4Q04), and unit shipments were up 14% to
    almost 13,000
--  Asia Pacific's share of L2-L3 Ethernet switch revenue is expected to
    grow from 20% in 2005 to 26% in 2009 at the expense of North America's
    share, though in actual dollars, all markets are growing long term
    

Router Highlights

--  Worldwide secure router revenue jumped 121% between 2004 and 2005,
    from $363 million to over $803 million, and unit shipments nearly tripled
--  In 2005, Cisco leads the enterprise router market by a wide margin,
    followed by Huawei and Nortel
    
Infonetics' L2-L7 LAN Switches report tracks layer 2-3 Ethernet switches, broken out by managed and unmanaged fixed configuration, chassis, and PoE switches, and layer 4-7 switches (with and without SSL). Forecasts are updated quarterly. Analysis and rankings are provided for 3Com, Alcatel, Allied Telesyn, Cisco, Citrix, D-Link, Enterasys, Extreme, F5, Foundry, NETGEAR, Nortel, ProCurve, Radware, SMC, and others.

The Enterprise Routers report tracks standard and secure high-end, mid-range, and low-end routers. Forecasts and market share are updated quarterly and cover all regions (worldwide, North America, EMEA, Asia Pacific, and CALA). Analysis and rankings are provided for 3Com, ADTRAN, Allied Telesyn, Cisco, Enterasys, Huawei, Nortel, Siemens, Vanguard, and others.

Download sample data at www.info.infonetics.com. For sales, contact Larry Howard, vice president, at larry@infonetics.com or +1 (408) 583-3335.

Infonetics Research (www.infonetics.com) is the premier international market research and consulting firm specializing in data networking and telecom. Services include quarterly market share and forecasting, end-user survey research, service provider survey research, and service provider capex analysis.

Contact Information

  • Press Contact:
    Matthias Machowinski
    Directing Analyst, Enterprise Voice & Data
    Infonetics Research
    781.933.9868
    Email Contact