Switching hits high gear in Q3

Modular data center, converged campus and overall market see growth

The modular data center Ethernet switch market was $900 million in the third quarter, up 4% from the same period a year ago, according to Crehan Research. Modular switches posted a second consecutive quarter of growth after underperforming other segments of the market, the firm states. 

The strength in modular ports shipments and sales propelled the overall data center Ethernet switch market to new highs in Q3, Crehan says, with revenue of $2.1 billion. And it goes both ways: 

"A strong upgrade cycle in server access Ethernet switches has driven demand for modular Ethernet switches in data-center network aggregation and core deployments," said Seamus Crehan, president of Crehan Research. "Furthermore, a recent flurry of exciting new product introductions with attractive throughput, pricing and port densities in conjunction with software-defined feature sets has reinvigorated interest in this segment." 

Such products include Arista's 7300X and 7500E switches, Cisco's Nexus 7700 and Insieme-developed 9500, HP's FlexFabric 11900 and 12900 and Juniper's EX9200 core switch. 

In the campus, the "Enterprise Edge" market - combined sales of enterprise-class wireless LAN and campus Ethernet switches - approached $3.8 billion in Q3, up 14% from a year ago, according to Dell'Oro Group. This was due to the first full quarter of shipment of 802.11ac WLAN products and wired/wireline convergence, with switches incorporating WLAN controllers

The overall Layer 2/3 Ethernet switch market continued to exceed $5 billion in Q3, according to Dell'Oro. Exact figures were unavailable, but the market in Q3, 2012, was $5.1 billion and $5.3 billion for Q3, 2011. 

Dell'Oro says Q3, 2013, was a record quarter and expects 2013 to be a record year for Ethernet switching. In port shipments, 10G Base-T was the strongest area of growth within the 10G Ethernet segment with three manufacturers exceeding 10,000 10G Base-T port shipments in the quarter. 

The market could be challenged in 2014, however, due in part to lack of access to the Chinese market, presumably from the NSA spying situation and the chilly reception Chinese vendors like Huawei and ZTE receive here.

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