Network equipment suppliers have cut prices
substantially for 10 Gigabit Ethernet and wireless Lan equipment
over the past month, writes Antony Adshead.
Analysts said the price cuts reflect the state of the market for
the two technologies, with 10 Gigabit Ethernet likely to drop
further in price, and WLan prices having bottomed out.
Suppliers Foundry and Force 10 have offered cuts of up to 40% on 10
Gigabit Ethernet equipment, while Proxim has made similar cuts on
WLan equipment.
Gartner analyst Andy Rolfe said, "What we are seeing are parts of
the natural cycle of the two technologies. Proxim is coming into
line with the market, where Far Eastern suppliers have helped lower
prices. WLans have come down the price curve. We will see
reductions, but the big falls have happened.
"10 Gigabit Ethernet is much earlier in its lifecycle and we will
likely see huge price falls as the manufacture of the technology is
made more cost-effective and the market becomes more active. Unless
there is a pressing need to buy now, wait for more price
cuts."
In a move that prompted a Gartner "first take" report, Force 10 has
cut the price of 10 Gigabit Ethernet line cards by 40%. According
to Gartner, the first 10 Gigabit Ethernet ports cost more than
$40,000 (£25,000) in 2002 and had inherent performance limitations.
Force 10's cuts have reduced the outlay per port to about
$17,000.
The analyst group said the price cuts offered a solution to a
problem many enterprises have faced - putting more bandwidth in
their backbones while keeping costs under control - and that they
would result in 10 Gigabit Ethernet becoming mainstream in the
enterprise.
Gartner also advised enterprises to use the Force 10 price cuts as
a means of negotiating with other suppliers to lower their prices,
although it said it expected other suppliers to follow suit
anyway.
Foundry, meanwhile, has announced the release of a 10 Gigabit
Ethernet card it said offers savings of up to 36% per port compared
to previous pricing, with the stated aim of pushing 10 Gigabit
Ethernet adoption in the Lan, Man and Wan.
In a move it described as "throwing down the gauntlet to Cisco",
Proxim has announced it will cut prices on two of its Orinoco
802.11b/a/g enterprise access points by 34%.
