WAN Optimization and ADC Markets Decline in 3Q12

Market data from Infonetics Research paints a mixed picture for data center, cloud and carrier networking gear deployment.

By Sean Michael Kerner | Posted Nov 28, 2012
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The third quarter of 2012 was not a kind one to multiple classes networking vendors. According to new data coming from Infonetics Research, the WAN optimization and ADC markets as well as the carrier routers and switches markets, declined during the third quarter of 2012.

Globally, Application Deliver Controller (ADC) revenues declined on a year-over-year basis, though sequentially Infonetics reported a 5 percent gain in the third quarter of 2012 over the second quarter of 2012.

Infonetics sees F5 as the global leader in ADC revenue, responsible for almost half of total industry revenue. During F5's most recent fiscal quarter, the ADC vendor reported a 15 percent year-over-year revenue growth, with $362.6 million in quarterly earnings.

After F5, Infonetics has Citrix and Cisco holding down the number two and three market share positions.

WAN Optimization

The WAN Optimization market is showing a similar trend as ADCs, with sequential growth of 3 percent, and a year-over-year decline of 4 percent for the third quarter of 2012.

Riverbed holds over 50 percent market share in the space,  followed by Cisco.

"While ADCs and WAN optimization appliances posted modest revenue gains in the 3rd quarter, the pace of growth in these segments decelerated year-over-year," Sam Barnett, directing analyst for data center and cloud at Infonetics Research said in a statement. "That said, we believe this will change as more virtualized solutions enter the mainstream, helping to restore higher levels of overall growth to the WAN optimization and application delivery controllers markets."

While WAN Optimization and ADCs are in a downturn, optimism over cloud services is very high. Infonetics currently reports that 91 percent of enterprise are already using cloud services with full 100 percent penetration by 2014.

Carrier Routers and Switches

According to the 3Q12 Service Provider Routers and Switches report, from Infonetics Research, revenuesInfonetics Carrier Routers 3Q12 for carrier routers and switch is also on the down swing.

Infonetics reported that global service provider router and switch market came in at almost $3.4 billion for the third quarter of 2012, for a 5 percent year-over-year decline.

In terms of vendors, Cisco remains in the top spot, followed by Juniper, Alcatel-Lucent and Huawei.

"The performance of the router/switch market roughly reflects economic conditions, and true to form economic weakness in Europe, North America, and Latin America drove down IP router and switch revenue in the third quarter," Michael Howard, Infonetics Research’s co-founder and principal analyst for carrier networks said in a statement.

Sean Michael Kerner is a senior editor at InternetNews.com, the news service of the IT Business Edge Network, the network for technology professionals Follow him on Twitter @TechJournalist.

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