Monday, April 13, 2015

Infonetics: SDN Hesitation Impacted SP Switch/Router Market

Service provider router and switch revenue totaled $14.6 billion worldwide in 2014, essentially flat over 2013 as SDN (software-defined networking) hesitation slowed spending, according to a new report from Infonetics Research, which is now part of IHS.

“We’ve been talking about this for the past year and it’s still true: the enormity of the coming SDN-NFV transformation is making carriers more cautious with their spending,” said Michael Howard, senior research director for carrier networks at Infonetics Research, now part of IHS. “But this does not mean that router and switch spending will take a sizeable downturn. Rather, we look for the market to slowly climb to $17 billion in 2019, a five-year compound annual growth rate (CAGR) of just over 3 percent—unchanged from our previous forecasts.”

Some highlights of Infonetics’ fourth quarter 2014 (4Q14) and year-end Service Provider Routers and Switches:

  • Worldwide service provider router and switch revenue was $3.8 billion in 4Q14, up 2 percent on a quarter-over-quarter and year-over-year basis
  • Sales in the core router segment dipped 5 percent in 2014 from the previous year as expected due to the volume of capacity already “in the ground”
  • Carriers in North America exercised caution in their router/switch spending in 2014, sending revenue down 7 percent from 2013
  • However, the other major geographical regions—EMEA, Asia Pacific and Latin America—were in positive territory in 2014
  • China came to the rescue of a flat 2014 Asian telecom economy with a double-digit increase over the previous year
  • On the whole in 2014 and 4Q14, the top 4 router and CES manufacturers—Alcatel-Lucent, Cisco, Huawei and Juniper—stayed in dominant positions, together taking 85 percent of revenue

http://www.infonetics.com/pr/2015/4Q14-Service-Provider-Routers-Switches-Market-Highlights.asp

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