Strong IP router sales help drive service provider router and switch market up 12% in 3Q07

Market Wire, November, 2007

On the heels of a strong second quarter, the worldwide carrier switch and router market posted another solid gain in the third quarter of 2007, jumping 12% sequentially, hitting $3.1 billion, says Infonetics Research in its latest quarterly report, "Service Provider Routers and Switches: IP, Ethernet, and ATM."

The market was led by healthy IP routers sales, remarkable sequential revenue growth (16%) from Juniper, and strong router performance by Cisco. Alcatel-Lucent also posted solid revenue numbers, the report shows, albeit slightly lower than the gains they posted the previous quarter.

"Gains in service provider router and switch sales this quarter were due to existing trends, rather than any new events, products or contracts. The top 2 drivers continue to be 1) the ongoing migration of service providers to next generation networks based on an IP, MPLS, and Ethernet data services layer, and 2) growth in consumer broadband, corporate, mobile telephony, and mobile data traffic," said Michael Howard, principal analyst at Infonetics Research.

"With the workforce becoming increasingly mobile and IP video and peer-to-peer applications becoming increasingly popular (music and video downloading, YouTube clips, online news, social networks like MySpace), service providers must continue investing in routers and switches with higher speed ports to manage the fast growing voice and data traffic," Howard added.

Other highlights from the report:

--  2007 is expected to set an all-time high record for worldwide service
    provider router sales
--  Worldwide carrier Ethernet switch (CES) sales are forecast to grow
    105% between 2006 and 2010; Cisco continues to lead by far in this segment,
    followed by Nokia Siemens
--  Worldwide service provider IP router unit shipments are up 15% and
    revenue is up 16% in 3Q07 from 2Q07
--  The portion of router and switch ports that are 10G Ethernet is
    increasing
--  Multiservice ATM switch revenue dropped 2% in 3Q07; main applications
    are still mobile backhaul/aggregation networks and DSL backhaul networks
    

Infonetics' report provides market share, market size, and forecasts for IP core and edge routers, multiservice ATM switches, enterprise-class Ethernet switches, and carrier Ethernet switches and routers. The report also tracks IP edge routers and CES by application (multiservice edge, BRAS, Ethernet access transport, and Ethernet services edge).

The report tracks Alcatel-Lucent, Avici, Ciena, Cisco, Ericsson, Fujitsu, Huawei, Juniper, NEC, Nortel, Redback, Tellabs, ZTE, and others.

Download report highlights at www.info.infonetics.com . For sales, contact Larry Howard, vice president, at larry@infonetics.com or 1 (408) 583-3335.

Infonetics ( www.infonetics.com ) is an international market research and consulting firm specializing in data networking and telecom. Services include quarterly market share and forecasting, end-user survey research, and service provider survey research and capex analysis.

Press Contact: Michael Howard Principal Analyst, Co-Founder Infonetics Research (408) 583-3351 Email Contact