Enterprise router market totals $3.5 bn in 2012: InfoneticsAuthor : Deepa March 5, 2013 0
BANGALORE, INDIA: Global enterprise router market totaled $3.5 billion in 2012, down three per cent from 2011, better than 2010 but a long way from the previous market high of $4.3 billion set in 2007. On the flip side, unit shipments for enterprise routers grew five per cent in 2012. Low-end routers made up all the revenue growth in 2012 (up 20 per cent), and now represent the largest segment in unit contributions, as per market research firm Infonetics Research.
“Buyers are resorting to low-end routers at their branches rather than the more typical branch and mid-range routers, which resulted in a revenue decline for 2012,” notes Matthias Machowinski, directing analyst for enterprise networks and video at Infonetics Research.
Mid-range router sales jumped eight per cent in 4Q12 from the previous quarter, possibly an early indicator of a turning point. One piece of good news: ASPs were very steady, falling less than one per cent in 2012, and in some cases growing. Infonetics forecasts the global enterprise router market to reach $5.0 billion by 2017, it adds.
“However,” Machowinski adds, “With the rise in cloud services adoption, we don’t think buyers are on a sustainable path with low-end routers at the branch, and we expect them to shift their spending back to branch and mid-range routers. Coupled with general economic growth, this should drive renewed revenue growth in 2013.”
Though there was a wide range of router vendor performances in 2012, market share changes were very minor; #1 Cisco gained 0.2 per cent share to 71.5 per cent and the top revenue share gainers were Huawei, Yamaha, and NEC.