Application acceleration market topped $1 billion in 2005

If all the news articles, product announcements and marketing hype around the application acceleration market had you wondering if the market was for real, you can stop wondering.

Market research firm Gartner last week released data that proved the application acceleration market increased some 36% in 2005 over 2004, pushing the worldwide vendor revenue from $915 million to $1.2 billion. The reason? More companies are consolidating data centers and therefore centralizing servers, which in turn increases the need for speedy application delivery over wide-area links. And with the slew of application acceleration products on the market today, customers can choose from a variety of options that promise to not only optimize and improve WAN performance but also lower costs.

“The trend toward powerful platforms that deliver four or more functions continued as enterprises continued to simplify their infrastructure and vendors moved to grow revenue and increase account control,” said Joe Skorupa, research director for Gartner, in a press release. “Market consolidation also continued in 2005 as strong platform players acquired promising software providers that had not yet reached critical mass in terms of distribution and revenue.”

Specifically, Skorupa broke down the market into two segments: application delivery controllers (ADC) and WAN optimization controllers (WOC). According to Gartner, ADCs reside in the data center and are deployed asymmetrically, meaning only on the data center end (much like Cisco recent Application Control Engine release). ADCs accelerate “end-user performance of browser-based and related applications” by offering several technologies that work at the network and applications layers, Gartner says. Companies such as F5 Networks and Cisco dominate this market. For instance, F5 takes the lead with a little more than 30% of the market, while Cisco is No. 2 with 29.3% market share.

On the other hand, WOC products are deployed symmetrically, on either end of a WAN link, and improve the performance of applications accessed across the WAN. The technologies typically address bandwidth consumption, latency and protocol issues. Gartner identifies companies such as Packeteer, Stratacache and NetApp as leaders in this market. But Skorupa said in a press release the market is going to change.

“The WOC market will undergo a major shift during the next 12 months as vendors respond to customer plans to eliminate branch office servers,” said Skorupa. “The services required at branch level continue to expand rapidly to include streaming content, XML/Web services processing, WAFS, DHCP/DNS, advanced compression/caching ECDN and secure tunneling. The development of branch-office boxes (BOB) has been driven by this increased demand for services at branch level.”