Router Market Shaken by Shifts in Market Share

Market Wire, 20050229

Restricted Capital Expenditure and cautious investment continues to weigh heavily on the High-End Router market with the market dropping 37% in 2002 to $3.5 billion. Despite the challenging market conditions, Cisco and Redback posted annual market share gains.

High-End Router Revenue Market Share 2002 2001 Cisco 75.4% 71.4% Juniper 12.9% 15.6% Redback 3.3% 2.6% Nortel 2.9% 3.5% Source: Synergy Research Group

For the year, Cisco continued to demonstrate that established sales channels, strong customer support, and a strong balance sheet continue to positively influence purchase decisions by both Telecom and Enterprise customers. Redback's market share gains were helped by two important customer wins: Shanghai Telecom and Tele2 in Sweden.

In Q4, Juniper gained market share in the Service Provider High End Market driven by strong European sales. Juniper is benefiting nicely from their strategic relationships with Ericsson and Siemens. Also seeing market share gains in Q4 included Redback and Nortel.

"Although no annual market share gains were measured for Nortel or Juniper, they, as well as Redback, continue to apply competitive pressure on Cisco," said Susana Vidal, Industry Analyst at Synergy Research Group. "We anticipate the competitive climate in the Service Provider Core and Edge Router markets to continue to heat up as Cisco's coveted market position continues to be challenged as measured by market share gains in Q4."

About the Report

SRG's Q4 and YE 2002 Router reports are available for purchase; contact Synergy at 602-287-9097 ext.101. Synergy's coverage of the router market includes SOHO, Branch and Mid-Size Routers; Enterprise and Service Provider Edge Routers; IP Edge, Broadband Aggregation and IP Services, and Service Provider Core Routers.

About Synergy Research Group

Synergy Research Group (SRG) is a market research firm, which specializes in quarterly market analysis, market share, forecasting, and strategic consulting. SRG offers a wide breadth of market research services to the equipment manufacturing, semiconductor, and financial communities. Synergy can be found at www.synergyresearchgroup.com.

The contents of this press release represent SRG's interpretation and analysis of statistics and information collected from authorized company representatives, industry sources, and SRG estimates. SRG does not guarantee the accuracy or completeness of the statistics or information contained in this release.