Increased 10G adoption pushes the market past $1 billion

Lower 10G Ethernet costs and growing bandwidth demands pushed the 10G Ethernet market over the $1 billion mark for the first time in 2006, research from the Dell'Oro Group says.

The average 10G Ethernet port cost around $4,000 last year, according to the Dell'Oro Group — a $1,000 drop in price from the previous year.

Meanwhile, sales of 10G Ethernet gear hit $1.2 billion in 2006 as enterprises installed the gear to grow data centers and campus LANs, and carriers rolled out the gear as a way to aggregate broadband traffic or deliver Ethernet-based services directly to customers.

The Dell'Oro Group report says sales of 10G Ethernet gear worldwide jumped almost 60% from $760 million the previous year. Port shipments also grew dramatically: Almost 300,000 10G Ethernet ports were shipped in 2006, which is more than double the amount shipped in 2005.

Cisco accounted for the majority of 10G Ethernet port shipments and revenue — as it does in all other LAN switch categories. Cisco took $810 million, or 67.5% of the worldwide 10G Ethernet revenue. Sharing the remaining third of the 10G Ethernet revenue pie were Force10 Networks, Foundry Networks, Nortel, Extreme and HP ProCurve.