Ethernet Switch Networking Market Surges Forward in 2017 to $25B

2017 marked a return to growth for the global Ethernet switching market, according to the latest market-sizing reports from research firms IHS Markit and IDC.

The IHS Markit Ethernet Switches Market Tracker for the fourth quarter of 2017 reported that the global market for Ethernet switches reached $6.7 billion for a 7 percent year-over-year gain. For the full year, IHS Markit reported Ethernet switch revenues of $25 billion for an 8 percent gain over 2016.

IDC also reported a strong market for Ethernet switches in 2017, with total revenue coming in at $25.7 billion for a growth rate of 5.4 percent year-over-year.

“Growth in the Ethernet switch market is being fueled by data center upgrades and expansion, as well as growing demand for campus gear due to improving business confidence,” stated Matthias Machowinski, senior research director for enterprise networks and video at IHS Markit.

Also among the key drivers is a transition to new networking speeds, including both 100 Gigabit Ethernet (GbE) and 25 GbE. IHS Markit reported that over 4 million 100 GbE ports were shipped in 2017.

“The transition to 25/100GE architectures in the data center is in full swing, driving strong gains in 25GE and 100GE, while in turn bringing down the 40GE segment, which had its first annual decline,” Machowinski stated. “Power over Ethernet is also growing once again, a sign of strengthening campus switching demand.”

IDC also noted the growth in 100 GbE as a driver for switch revenues in 2017. “The Ethernet switching market continues to rapidly mature with customers quickly moving to higher 100GbE speeds, especially in data center deployments,” Rohit Mehra, vice president, Network Infrastructure at IDC, stated.

According to IDC, 100 GbE accounted for 9.6 percent of total market revenue at the end of 2017, up from 4.8 percent in the fourth quarter of 2016.

Though there is movement toward 100 GbE, there is still lots of money being made in the 10 GbE and 1 GbE space as well. IDC reported that 10 GbE shipments grew by 37.2 percent in 4Q17. 1 GbE also grew port shipments though only by a more modest 5.4 percent year-over-year. In terms of revenue, IDC reported that 1 GbE accounted for 42.4 percent of the overall Ethernet switch market’s revenue while 10 GbE represented 34.7percent.

Cisco remains the top vendor in the market, followed by Huawei in the number two spot and HPE coming in third.

IDC Switching 4Q17

Sean Michael Kerner is a senior editor at EnterpriseNetworkingPlanet and Follow him on Twitter @TechJournalist.

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