Ethernet poised to take over the metro in next 10 years

Worldwide metro Ethernet equipment revenue reached $2.5 billion in 2002 and is projected to grow 131% to $5.7 billion by 2006, reveals new data from Infonetics Research (San Jose, CA). Worldwide metro Ethernet equipment ports hit 756,000 in 2002 and are expected to grow 337% to 3.3 million by the end of the forecast period.

"In the next 10 years, Ethernet will inexorably take over the metro," surmises Michael Howard, principal analyst and Infonetics Research co-founder. "Of course, there will never be a wholesale change because of the SONET/SDH installed base, but every year Ethernet will account for a larger portion of metro capex [capital expenditures]. Between 2002 and 2006, Ethernet will make major inroads into metro telecom equipment spending, accumulating $18.9 billion."

The spending is driven by increased customer demand for Ethernet services, lower prices, and the convenience of incremental bandwidth that Ethernet enables. Even with capex pressures, say analysts, service providers must respond to customers or they risk losing them to a competitor; they have to invest in metro Ethernet equipment. The report also finds that:

  • Ethernet switches and routers captured 66% of the total revenue in 2002.
  • Ethernet over SONET/SDH (standard and via resilient packet ring) accounted for 21% of revenue in 2002.
  • Asia-Pacific leads the market in 2002 with 43% of the spending, followed by North America with 37%.

For more information on the report, "Metro Ethernet Equipment," call 408-298-7999 or visit the firm's Website, www.infonetics.com.

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