HPE Aruba, Juniper Mist navigate component shortages to gain share

According to a recently published report from Dell’Oro Group, the trusted source for market information about the telecommunications, networks, and data center industries, the Wireless LAN market jumped to a new high in the second quarter, eclipsing $2 Billion, with HPE Aruba and Juniper Mist overcoming supply constraints to contribute over two thirds of the shipment growth outside China. Enterprises saw a 10 percent increase in average prices compared to last year, boosting manufacturers’ revenues and helping to defray additional costs.

“HPE and Juniper really pulled rabbits out of their hats this quarter ̶ Aruba and Mist represent the majority of the growth in units shipped outside China,” says Siân Morgan, Wireless LAN Research Director at Dell’Oro Group. “It’s like a game of whack-a-mole for the manufacturers. They’ll get their hands on one particular access point component and then another shortage will pop up. We’re expecting shipments to be lumpy through the next few quarters. Cisco has promised shipments ‘en masse’ for enterprises, and all of the manufacturers are busy finding creative solutions: redesigning products, using brokerage firms, or bypassing component distributors.

“Wireless LAN solutions have also become more expensive for enterprises. It’s very rare to see such a long stretch of quarters with year-over-year price increases. It’s a combination of higher-end products being available, including the new Wi-Fi 6E technology, as well as a general move by the manufacturers to cover their escalating costs. Looking ahead we have to ask ourselves how long the market will bear these higher prices,” added Morgan.

Additional highlights from the 2Q 2022 Wireless LAN Quarterly Report:

• The Wireless LAN market saw two distinct phenomena driving the growth: one in China, and another one in the markets outside China.
• In light of the China lockdowns, the Wireless LAN market in China showed surprising strength with both Huawei and H3C pulling in strong quarters.
• Wi-Fi 6E shipments accelerated this quarter, as another half dozen vendors started shipping products supporting the new 6 GHz band.
• However, now in its fourth quarter of product availability, Wi-Fi 6E is lagging the adoption rate of the prior two generations of Wi-Fi.
• Revenue from public cloud-managed APs has outpaced the market. The cloud-managed AP business is still dominated by Cisco – although this quarter, Juniper grabbed an outsized market share in cloud-managed Wireless LAN.

CT Bureau