The worldwide Ethernet switch market recorded $6.7 billion in revenue in the first quarter of 2021 (1Q21), an increase of 7.6% year over year. Meanwhile, the worldwide total enterprise and service provider (SP) router market revenues grew 14.4% year over year in 1Q21 to $3.4 billion. These growth rates are according to results published in the International Data Corporation (IDC) Worldwide Quarterly Ethernet Switch Tracker and Worldwide Quarterly Router Tracker.
Ethernet Switch Market Highlights
From a geographic perspective, the 1Q21 Ethernet switch market had mixed results across the globe. Asia/Pacific markets had a strong quarter: revenues in the People’s Republic of China increased 19.8% year over year while Japan’s market increased 23.5% on an annualized basis. More broadly in the Asia/Pacific region, excluding China and Japan, the market rose 7.2% in the quarter, buoyed by the Korean market which increased 17.9%. In Europe, results were uneven: Western Europe’s market rose 16.7% with strength from Germany growing 14.3%. Central and Eastern Europe’s market declined 7.8%. In the Middle East & Africa, the market declined 3.7% year over year. Across the Americas, the market in the United States increased 2.5% while Canada’s market fell 11.8% and Latin America’s market increased 2.5% year over year.
“Despite regional differences, growth in the first quarter of the calendar year reflects optimism that 2021 will be a stronger year compared to 2020 for the worldwide Ethernet switch market,” said Brad Casemore, research vice president, Datacenter and Multicloud Networks. “As a semblance of normalcy and predictability return, enterprises will look to reinvest in their campus and datacenter networks. Meanwhile, cloud SPs, including the largest hyperscalers, continue to grow and frequently refresh their datacenter networks with high-bandwidth switching to meet increased enterprise and consumer demand for cloud services.”
Growth in the Ethernet switch market continues to be driven by the highest speed switching platforms. For example, port shipments for 100Gb switches rose 16.9% year over year while 100Gb revenues grew 27.2%; 100Gb Ethernet switches now make up 24.5% of the market’s revenue. 25Gb/50Gb switches also saw impressive growth with revenues increasing 28.0% and port shipments growing 21.0% year over year.
Lower-speed switches, a more mature part of the market, saw mixed results. 10Gb port shipments rose 18.1% year over year, but revenue declined 0.4%; 10Gb switches make up 23.3% of the market’s total revenue. 1Gb switches increased 12.2% year over year in port shipments and fell 2.4% in revenue. 1Gb accounts for 35.0% of the total Ethernet switch market’s revenue. This quarter the IDC Ethernet Switch Tracker added new speeds, including 200Gb/400Gb as well as 2.5Gb/5Gb, both nascent segments that are expected to be fast-growing in future quarters.
Overall port shipments increased 15.4% in 1Q21, driven by strength across both the datacenter and non-datacenter segments of the Ethernet switch market. Revenues in the datacenter Ethernet switch market increased 10.2% in the quarter. Datacenter switches make up 13.0% of all port shipments, but 43.1% of the market’s revenues. Non-datacenter switches, meanwhile, account for the majority of the market’s shipments (87.0%) and revenues (56.9%); the non-datacenter portion of the switch market grew 5.8% in revenues year over year.
Router Market Highlights
The worldwide enterprise and service provider router market increased 14.4% year over year in 1Q21 with the major Comm SP segment, which accounts for 77.5% of revenues, growing 18.0% and the enterprise segment increasing 3.7%. From a regional perspective, the combined service provider and enterprise router market increased 27.8% in Asia/Pacific (excluding Japan & China). Japan’s total market declined 2.6% while the People’s Republic of China market was off 0.8%. Revenues in Western Europe grew 19.9% year over year, while the Central and Eastern Europe combined enterprise and service provider market rose 18.1% and the Middle East & Africa region grew 11.0%. In the U.S., the enterprise segment was down 5.4%, while the Comms SP segment revenues increased a strong 38.7%, giving the combined markets 25.7% growth on an annualized basis. The Latin American market grew 4.6% on an annualized basis.
Cisco finished 1Q21 with a year-over-year increase of 3.4% in overall Ethernet switch revenues and market share of 49.3%. In the higher-speed segment of the Ethernet switch market (25Gb/50Gb,100Gb & 200Gb/400Gb), Cisco is the market leader with 40.9% of revenues. Cisco’s combined service provider and enterprise router revenue grew 18.5% year over year, with enterprise router revenue decreasing 1.3% and SP revenues increasing 33.2% year over year. Cisco’s combined SP and enterprise router market share stands at 37.6%.
Huawei’s Ethernet switch revenue increased 1.7% on an annualized basis, giving the company market share of 7.9%. The company’s combined SP and enterprise router revenue grew 1.5% year over year, giving the company a market share of 25.5%.
Arista Networks saw Ethernet switch revenues increase 28.6% in 1Q21, bringing its share to 7.9% of the total market. 100Gb revenues account for 71.4% of the company’s total revenue, reflecting the company’s longstanding presence at cloud providers.
HPE’s Ethernet switch revenue increased 6.3% year over year, giving the company a market share of 6.0%.
Juniper’s Ethernet switch revenue declined 14.8% year over year in 1Q21, bringing its Ethernet switch market share to 2.6%. Juniper saw a 21.1% increase in combined enterprise and SP router sales, bringing its market share in the router market to 11.1%.
“Results in the Ethernet switch and routing markets were mixed across geographies, indicating the uneven recovery from the impact of COVID-19 across the globe,” notes Petr Jirovsky, research director, IDC Networking Trackers. “Strong growth in key areas – particularly the highest speeds of the Ethernet switch market – bodes well for continued progress in 2021 as organizations of all sizes focus on investing in technology to power the future of connectivity.”
The IDC Worldwide Quarterly Ethernet Switch Tracker and Worldwide Quarterly Router Tracker provide total market size and vendor shares for the Ethernet switch and router technologies in an easy-to-use Excel pivot table format. The geographic coverage for both the Ethernet switch market and the router market includes nine major regions (USA, Canada, Latin America, People’s Republic of China, Asia/Pacific (excluding Japan & China), Japan, Western Europe, Central and Eastern Europe, and Middle East and Africa) and 60 countries. The Ethernet switch market is further segmented by speed (100Mb, 1000Mb, 2.5Gb/5Gb, 10Gb, 25Gb, 40Gb, 50Gb, 100Gb, 200Gb/400Gb), product (fixed managed, fixed unmanaged, modular), and layer (Ethernet switch, ADC).
Measurement for the Ethernet switch market is provided in vendor revenue, value, and port shipments. The router market is further split by product (high-end, mid-range, low-end, SOHO), deployment (service provider, enterprise), connectivity (core, edge), and the measurements are in vendor revenue, value, and unit shipments. Both Trackers are part of the Worldwide Quarterly Enterprise Infrastructure Tracker, which provides a holistic total addressable market view of the five key enabling infrastructure technologies for the datacenter (servers, external enterprise storage systems, purpose-built appliances: HCI and PBBA, and datacenter switches). IDC