IDC: LAN switch, router markets to bounce back, but have a ways to go

While IDC predicts that the market for Ethernet LAN and routing gear will rebound this year from a 2001 slump, sales figures for the fourth quarter of last year show the road to recovery could be long.

The $3.6 billion in the fourth quarter of 2001 worldwide LAN switch sales was down 25% from the same quarter in 2000, a period which IDC identifies as the last quarter of growth before the industry went into a slump last year. World wide router sales were down 4.6% in the fourth quarter of 2001, compared to the previous quarter while Ethernet switch revenue stayed relatively flat, growing by only 1.4%.

A bright spot for the LAN switch market was Gigabit Ethernet switch sales, which were up 13.5% from the fourth quarter of 2000, although IDC says this was below the expectations of vendors.

High-end router sales were also down significantly in the fourth quarter, dropping 37% from the previous year. IDC says that while the slowdown in carrier equipment spending hurt router market, it was the drop in enterprise high-end router purchases, which really hurt the market, with enterprises accounting for less than a third of total revenue.

Cisco stayed the leader in Gigabit router sales, with 65.9% of worldwide revenue, up 0.6% from the previous quarter. Juniper was second, with 16.3%, a drop of almost 4 percentage points from the third quarter of 2000. Riverstone Networks and Unisphere had something to do with Juniper's slide, as the market newcomers garnered 6.2% and 5.7% of the market respectively.