Speed, security features drive router and switch sales higher

Sales of enterprise routers and switches grew in the third quarter of 2005, as users sought to install more secure WAN connections and faster, more intelligent LAN pipes.   According to Infonetics Research, the enterprise router market grew 8% between July and September 2005, with $859 million in worldwide revenue.

Sales of enterprise routers and switches grew in the third quarter of 2005, as users sought to install more secure WAN connections and faster, more intelligent LAN pipes. 

According to Infonetics Research, the enterprise router market grew 8% between July and September 2005, with $859 million in worldwide revenue.

“Secure routers” – boxes that roll firewall, VPN and WAN connectivity into a single device – are becoming more popular, as sales of such gear rose 21% from the previous quarter. Sales have doubled since the third quarter a year ago.

Cisco dominated the enterprise router market in the third quarter, accounting for 80% of sales.

Layer 2 and Layer 3 Ethernet switch sales climbed 6% in the third quarter, to $3.95 billion. But 10 Gigabit Ethernet and Layer 4-7 gear were particularly hot: 10 Gigabit sales were up 29% from the previous quarter, and Layer 4-7 gear sales climbed 19% from the same quarter a year ago. With multi-layer switches, SSL technology is becoming a popular feature, Infonetics reports, as 51% of the $181 million in gear sold included SSL capabilities.

The SSL uptick could be a sign that enterprises are installing more security measures in data centers, since Layer 4-7 gear is usually put in front of banks of Web and application servers. SSL is also used on Layer 4-7 switches to support SSL-based VPNs, which allow end users to access secure applications via a Web connection and do not require client-side software.

As for carrier gear, the worldwide service-provider router and switch market hit $1.86 billion in the third quarter, an increase of 3% over the second quarter of 2005. While Cisco dominated most enterprise switch and router categories, its lead in carrier gear is smaller, with 41% of the market.