Infonetics: Carrier router and switch market to recover in 2013

Feb. 25, 2013
This year looks set to be a better one across multiple market sectors, according to Infonetics Research. Having promised better times ahead for optical transport vendors in 2013 (see “Infonetics sees 2013 growth in optical hardware sales), the market research firm is also predicting a resurgence in the carrier router and switch market.

This year looks set to be a better one across multiple market sectors, according to Infonetics Research. Having promised better times ahead for optical transport vendors in 2013 (see “Infonetics sees 2013 growth in optical hardware sales"), the market research firm is also predicting a resurgence in the carrier router and switch market.

The company has released vendor market share and preliminary analysis from its fourth quarter 2012 (4Q12) and year-end Service Provider Routers and Switches report.

“The global carrier router and switch market ended 2012 with a small 4% loss, but it could have been worse,” notes Michael Howard, Infonetics’ co-founder and principal analyst for carrier networks. “Significant budget flushes from operators in Europe, China, and Latin America buoyed the overall market in the final quarter of the year.”

“Looking ahead,” Howard adds, “We expect the service provider switch and router market to grow again in 2013. The US economy is in better shape and we are predicting an increase in worldwide carrier capex this year. In EMEA, activity looks good for the Middle East and, to some degree, Africa, and Europe seems to have hit bottom. If our talks with European service providers prove true, then we can expect a slow climb for the IP router and switch market there, albeit from this lower starting point. Operators know they need to spend on their networks or risk becoming uncompetitive.”

For all major world regions except North America, the fourth quarter of 2012 was strong, with global IP edge and core router and Carrier Ethernet switch revenue rising to $3.8 billion, up 12% from the previous quarter.

While North America was down a bit sequentially in 4Q12, the region is up 13% from the year-ago 4th quarter, the highest year-over-year gain of any region.

In 2012, sales of core routers slowed more than edge routers, as the coming move to 100G is making carriers increasingly cautious as they choose the next generation of higher-capacity core routers.

The top four manufacturers in the router and Carrier Ethernet switch segment stayed in dominant positions in 2012, with Cisco Systems Inc. holding steady at number one, Huawei Technologies Co Ltd. boosting its market share but staying in second place, while Alcatel-Lucent moved into third position, bumping Juniper Networks to fourth.

Infonetics’ quarterly routers and switches report provides worldwide, regional, China, and Japan market share, market size, forecasts, analysis, and trends for IP edge and core routers and Carrier Ethernet switches, including IP edge market analysis by application.

For more information on Carrier Ethernet equipment and suppliers, visit the Lightwave Buyer’s Guide.

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