Together, Cisco and Juniper lost 10% of the worldwide router market in 2009

Meanwhile, Huawei and Alcatel-Lucent gained share.

By Brad Reese on Fri, 02/19/10 - 10:44am.

Network industry research firm - Infonetics, published this week its 2009 4th Quarter Service Provider Routers and Switches Forecast Report, revealing vendor market share standings for the quarter and 2009.

According to Michael Howard - Infonetics co-founder and principal analyst:

"The top two vendors in the service provider router space, Cisco and Juniper, together went from owning 69% of the worldwide router market in 2008 to 59% in 2009, while Alcatel-Lucent, Huawei, and others gained share. Interestingly, smaller player Tellabs pushed past Ericsson in 2009, putting them in the top five for the first time. Tellabs had an especially strong year based on their focus on the mobile sector. All six of the top router vendors posted strong double-digit revenue increases in the fourth quarter, and we expect modest growth in the router segment to continue in 2010 as carriers carry out fixed-mobile convergence strategies for their router networks."

Infonetics reported, "While the combined market was buoyed in the fourth quarter, it was not enough to offset losses for the year, bringing the overall market down 12% from 2008 to 2009, to $11.1 billion.

"Multiservice ATM switches led the downward trend, as expected (this segment has been in decline for many quarters now)."

Infonetics continued, "Asia Pacific is the only region to post year-over-year growth in IP edge and core router revenue, up 19% in 2009 from 2008, pushed in no small part by the Chinese government telecom stimulus and the competitiveness of the newly re-organized Chinese operators."

Infonetics added, "Worldwide revenue from service provider IP edge routers, IP core routers, carrier Ethernet switches, and multiservice ATM switches jumped 17% in 4Q09, led by strong IP edge router sales."

It appears Cisco did not "fully benefit" from this 17% 4Q09 revenue jump.

How so?

Well, Cisco Service Provider Routing & Switching Director - Mike Capuano, acknowledges that Cisco's SP Router revenue was actually up QoQ 11% for SP Routing the calendar quarter 4Q09, even though the SP Router market grew 17% according to Infonetics.

Cisco's Official Response to this story:

"Cisco read your blog post titled 'Together, Cisco and Juniper Lost 10% of the Worldwide Router Market in 2009,' published on Friday, 2/19, and believe there are some accidental misinformation in your posting. In your post, you compare Infonetics’ QoQ SP Router overall market growth of +17% for calendar year 4Q09 to Cisco's SP + Enterprise YoY router growth of +2% for the fiscal year. However, Cisco was actually up QoQ 11% for SP Routing this calendar quarter, and as shared by John Chambers in Cisco’s most recent earnings conference call, HE Routing was up 12% YoY for the fiscal year. As such, Cisco believes that the overall routing chart showing 2% should be removed from your posting as it is out of context."

However, where there's smoke, there's fire!

The Dell’Oro Group 4Q09 SP Router Market Share Report:

Source: The Dell’Oro Group

The Dell’Oro Report above clearly states that the SP router market grew 15%. Obviously, Cisco lost SP router market share in calendar year 4Q09 if it only grew 11% compared to overall SP router market growth of 15%.

Clearly, Cisco's competitors are growing their SP router market share at the expense of Cisco's shrinking market share.

Alcatel-Lucent knocked off Juniper and is now No. 2 in SP edge router market share

Om Malik of GigaOM - Is Competition Starting to Eat Into Cisco’s Core Markets?

What's your take, why do you think Cisco grew far less than the market in 4Q09?

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