Low growth in routing and switching market: IDC

The worldwide Ethernet switch market (Layer 2/3) reached $5.2 billion in the first quarter of 2014 (1Q14), representing year-over-year growth of 0.4 per cent and a significant seasonal decline of -12.3 per cent quarter over quarter.

Meanwhile, the worldwide router market fared somewhat better, growing 2.3 per cent year over year. Sequentially, the router market also decreased -12.5 per cent, according to the preliminary results published in the International Data Corp. Worldwide Quarterly Ethernet Switch and Router Tracker.

From a vendor perspective, Cisco’s Ethernet switch revenue decreased -4.3 per cent year over year in 1Q14 and its market share was 60.4 per cent, which was slightly down from 61.1 per cent in 4Q13. Cisco’s market share in the fast growing 10GbE market segments was 62.2 per cent in 1Q14. Cisco’s service provider and enterprise router revenue declined -1.8 per cent year over year this quarter.

HP’s Ethernet switch revenue increased 4.6 per cent year over year in 1Q14, ahead of the overall market growth. HP’s market share now stands at 9.2 per cent in 1Q14, on par with 4Q13, but up from the 8.8 per cent in 1Q13.

Juniper Networks had a strong quarter, having outperformed in both Ethernet switching and routing in 1Q14. Its router revenue was up 5.4 per cent year over year and its Ethernet switch revenues saw exceptional strength, increasing 53.4 per cent year over year.

“However, regional variations in the market persist and vendors are cautioned to take this into account while working on their near- to mid-term go-to-market strategies.”

From a geographic perspective, the Ethernet switch market saw its highest growth in Latin America (up 11.4 per cent year over year), relatively good performance in Asia/Pacific (up 1.9 per cent year over year), and annual declines in both Europe, Middle East & Africa (EMEA) (down -0.5 per cent year over year) and in North America (down -1.2 per cent year over year).

IDC vice president of network infrastructure research, Rohit Mehra said the worldwide Ethernet switch market continues to see different trends across market segments with data centre deployments seeing growth in spite of the ongoing market transition while the enterprise campus segment is essentially flat lining or seeing slight declines depending on the segment or geography involved.

The worldwide enterprise and service provider router market grew 2.2 per cent year over year in 1Q14. However, performance of the key segments within the router market varied widely with the service provider segment growing 4.2 per cent year over year, whereas the enterprise segment declined -2.9 per cent year over year. The router market also saw a varied performance on a regional basis. Asia/Pacific, Latin America, and EMEA all showed solid growth with 13.8 per cent, 11.1 per cent, and 9.1 per cent year-over-year increases respectively. North America, on the other hand, declined -9.4 per cent year over year.

NAND Flash market in decline

The shipment performances of smart phones, tablets, and notebooks were relatively weak in Q1 due to seasonality. As a result of the entire NAND Flash market’s oversupply in Q1 2014, the branded suppliers’ Q1 revenues saw a 6.6 per cent drop compared to the previous quarter, and slid to approximately US$ 7,244 million, according to new research from the memory and storage research division of TrendForce.

Samsung managed to retain its lead in the market with approximately $ 2,175 million in sales, but saw its market share dip slightly to 30 per cent; Toshiba came in second with a revenue total of $ 1,548 million and an improved market share of 21.4 per cent; SanDisk ended up in the third place with $ 1,367 million in revenue, while Micron came in fourth with $ 1,050 million; affected by its capacity allocations, SK Hynix’s revenue slid to approximately $ 594 million, with a market share of 8.2 per cent.

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