Service Provider Routers and Switches a $10B Market in 2009

Infonetics:Strong IP router and carrier Ethernet switch and router (CESR) sales will push the worldwide service provider router and switch market to $10 billion in 2009, up from $7.2 billion in 2005.

While multiservice switch sales are expected to continue to decline, the emerging CESR products are forecast to more than double between 2005 to 2009, from $2.1 billion to $5.0 billion, as carriers rely more and more on Ethernet to transport IP traffic in their networks.

Meanwhile, the ratio of routers to multiservice switches (MSS) continues to shift dramatically:

• In 2000, routers made up 47% of worldwide router/switch revenue share, MSS made up 53%

• In 2005, routers made up 73%, MSS 27%

• In 2009, routers will make up 83%, MSS 17%

.Service providers are clearly moving toward next gen IP networks, and Ethernet plays a strong growing role in that move. It is no surprise that carrier Ethernet switches and routers (CESR) show up big in 4Q05 in our new quarterly report. Providers need carrier-class products; eventually, nearly every service provider IP router will be designed to meet the specifications of CESR products.

• A total of $43.4 billion will be spent on service provider routers and switches worldwide during the five-year period between 2005 and 2009

• Core and edge router sales jumped 31% between 2004 and 2005, from $4.0 billion to $5.2 billion

• Multiservice switch revenue dropped 5% between 2004 and 2005, from $2.1 billion to $2.0 billion

• Carrier Ethernet switch and router revenue totaled $617 million in the fourth quarter

• Cisco maintains its strong lead in the service provider router market, with 42% revenue share in 2005, followed by Juniper with 19%, then Nortel and Alcatel

• North America’s share of the worldwide service provider router and switch market fell to 37% in 2005, from almost 60% in 2000

Service Provider Routers and Switches Publ 20060221