Infonetics Research: 40G growing fast to satisfy traffic as 100G develops

OCTOBER 22, 2008 -- Despite the economic downturn, the 10G market is thriving and will continue to thrive for many years to come, 40G is ramping rapidly, and 100G should begin soon and take off by 2013, says Infonetics Research.

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OCTOBER 22, 2008 -- The 10-Gigabit (10G) market is big and growing fast, on target to hit nearly $9.5 billion worldwide in 2008, says a new report from market research firm Infonetics Research (search for Infonetics Research). Moreover, despite the economic downturn, the 10G market is thriving and will continue to thrive for many years to come, 40G is ramping rapidly, and 100G should begin soon and take off by 2013, say analysts.

"A majority of service providers we've spoken to are expecting to invest in 40G until the 100G market is up and running; some providers are hoping to skip the 40G phase altogether, but we don't see that being a viable option, as growing traffic demands are outstripping current capacities and 100G won't reach reasonable price points until about 2012 or 2013," says Michael Howard, principal analyst and co-founder of Infonetics. "When 100G Ethernet arrives, it'll be the next big thing and the most important, because it will last to at least 2025, solving traffic problems for a very long time," he contends.

"As corporate applications get more and more bandwidth intensive and enterprises centralize their resources, a tremendous strain is being put on their networks," adds report co-author Matthias Machowinski, directing analyst for enterprise voice and data at Infonetics. "In our latest user study, increasing network capacity was named by network managers as their number one initiative; it's no surprise then that shipments of 10G ports are going through the roof. Ethernet switch-based 10G port shipments, for example, grew 140% in 2007," he notes. "Growth should remain healthy for years to come, as this is an area where buyers are putting their money where their mouths are."

Other highlights from the report include the following:
• 40G revenue is forecast to increase at a fast clip, with a compound annual growth rate (CAGR) of 59% from 2007 to 2011.
• In 2008, the average revenue per 10G Ethernet port on service provider equipment is more than 10 times that of enterprise equipment.
• The number of 10G, 40G, and 100G ports shipping on enterprise and service provider equipment will jump from over 1 million in 2007 to 7.4 million in 2011, with 100G making its small debut in 2009.

Infonetics' report, "10G/40G/100G Market Size and Forecasts," provides worldwide and regional market size and forecasts from 2007 to 2011 for 10G/40G/100G optical (OC192/STM64, etc.) and Ethernet ports and revenue for enterprise Ethernet switches, routers, and application switches; and service provider routers, carrier Ethernet switches (CES), optical gear (WDM and SONET/SDH), PON OLTs, CMTS, and multiservice ATM switches.


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