Enterprise network kit continues to boom in recession

New research from IDC shows revenues for both Ethernet switches and routers are growing regardless of the economic climate

IDC has released research this week showing growth across the board in enterprise network revenues, proving IT departments are still investing into the equipment despite the tough economic climate.

Cisco continued to dominate the industry, holding just over 62% of market share, whilst its nearest competitor, HP, held only 9.2%.

Growth in router revenues globally was modest, rising by 0.6% year-on-year (YoY). The figure remained small as, even with huge growth markets in Latin America – revenues rose 16.8% - and Asia Pacific – up 10.5% from 2011 – there were declines of 0.4% in North America and a huge 10.6% in Europe, the Middle East and Africa (EMEA).

The Ethernet switch market, however, told a much more positive story. Global revenues hit $5.5bn in the second quarter of 2012, translating to a growth of 8.5% from the same period last year. All regions showed improvement, with Latin America again bringing in the biggest growth – 17% YoY – but even EMEA revenues rose by 5.2% and the US went up by 5.9%, showing despite any economic troubles, companies still wanted or needed to invest into switches.

"Building on the momentum from the previous quarter, the positive Q2 performance in the Ethernet switch market shows that the network continues to play a pivotal role in IT infrastructure rollouts," said Rohit Mehra, director of enterprise communications infrastructure at IDC.

"10GbE along with the emerging 40GbE Ethernet switch segments are leading the market to higher levels, clearly proving the point that growth in applications, virtualisation and mobility has to be looked at in conjunction with the underlying wired infrastructure in datacentres and campus deployments."

However, the smaller capacity networking products saw rises too.

"Even the Gigabit Ethernet segment showed strength in O2 with over 55 million ports shipped in the quarter and market revenues growing 6.5% from the previous quarter," said Petr Jirovsky, senior research analyst for the networking trackers group at IDC, responsible for the research.

"The overall market drivers, such as proliferation of video traffic on the network, are mitigating to a large extent the increased macroeconomic uncertainty and weakness in the public sector in many regions."

Read more on Network routing and switching

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