ADC Market Growing as WAN Optimization and PBX Decline

The networking business is broad and diverse with many different segments, some on the rise, some not so much. According to a new set of research forecasts set to be announced this week by Infonetics Research, the market for Application Delivery Controllers (ADCs) is on the growth side, while WAN optimization and Unified Communications are headed the other way.

In the second quarter of 2013, global revenues in the ADC market grew 4 percent on a year-over-year basis and 7 percent sequentially. Infonetics places F5 as the top vendor in the space, followed by Citrix and Radware.

F5 has steadily been growing its business with new software and hardware updates. In July, the vendor announced its BIG-IP 11.4 update, providing new scalability and software defined networking capabilities to its ADC portfolio. During its recent third quarter fiscal 2013 earnings call, F5 reported increased revenues from its ADC business, coming in at $366.8 million for the quarter.

“Things are looking more positive for the application delivery controller (ADC) market,” Cliff Grossner, Infonetics Research’s directing analyst for data center and cloud, said in a statement. “Previously delayed Tier 1 projects are back on track, and enterprise spending in North America is picking up.”

As recently as the third quarter of 2012, Infonetics was reporting year-over-year declines in the ADC business.

WAN Optimization

In contrast to the ADC market, Infonetics sees the WAN optimization business locked in a downward spiral. Revenue for WAN optimization declined 11 percent in the second quarter of 2013 on a year-over-year basis.

“What could bring this market back to life is the growing demand for cloud services, which can benefit from a smart device at the branch office that enhances the delivery of cloud services over the WAN,” Matthias Machowinski, directing analyst for enterprise networks and video at Infonetics Research, said in a statement. “But so far cloud services have yet to become a demand driver.”

Infonetics pegs Riverbed as the top vendor in the WAN optimization space today, followed by Cisco, Blue Coat and Citrix.


When it comes to Unified Communications (UC), Infonetics reported the global market for enterprise PBXs to be $1.81 billion for the second quarter of 2013. That figure represents a 9 percent year-over-year decline.

“Slower demand and competitive pricing pressure delivered a one-two punch to the enterprise PBX market in the 1st half of 2013,” Diane Myers, principal analyst for VoIP, UC, and IMS at Infonetics Research, said in a statement.

Sean Michael Kerner is a senior editor at EnterpriseNetworking Planet and Follow him on Twitter @TechJournalist

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