ACG Research

ACG Research
We focus on the Why before the What

Wednesday, August 21, 2013

Edge Leading the Positive Growth for Router Market in Q2

The Worldwide Carrier Routing and Switching market increased both quarter over quarter and year over year, 14% and 5% respectively, with revenues of $3 billion. The core routing segment posted revenues of $590 million, down 6.6% y-y but up 7.4% q-q. Core has been in a soft cycle but we anticipate growth as the delays in upgrades are now starting to be addressed. The edge market posted solid revenues of 2.4 million, 8% y-y and up 16% q-q. The SP edge market continues to be competitive because of the diverse range of applications and solutions, requirement variations in the regions, and cross-technology solutions. 
Worldwide Carrier Routing & Switching Market Shares
Revenue ($M)
 $ 1,524.8
 $    586.9
 $    515.2
·  Operators are more focused on the drivers in the edge of the network, which is increasing demand for edge products. Carriers are increasingly moving to 100G, which is contributing to the caution carriers are exhibiting as they choose their next core routers.
·   Enterprise networks will continue to lead SDN adoption even though the really big potential impact will eventually come from carriers, which will take place when carriers have WAN infrastructure in place to support new services.
·   A key driver contributing to service provider router and switching market growth is the increasing demand for mobile broadband and providers investing in wireless networks to meet that demand.

·   Interest in software-defined networking has increased in momentum for two primary reasons: 1) a less than positive macroeconomic environment and 2) SPs are searching for a new way to deliver services and realize OpEx savings.
In spite of weaknesses and challenges in some global economies, the long-term demand for high-performance and innovative networks continues to be strong. Mobility, Big Data, capacity constraints and better utilization on network assets, which is instigating a significant shift in networking, is top-of-mind for providers. Service providers are looking to vendors for solutions that support these demands. In response vendors are delivering cutting-edge products and services that address virtualization, software-defined networking, and cloud. For more information about ACG's router and switching service, contact                                                                                                                

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