F5 going strong in Layer 4-7 switch market

Last week my colleague Phil Hochmuth wrote about the changing landscape in the Layer 4-7 switch market. Those devices were originally designed as Web switches to speed Web traffic in the exploding dot-com world. When dot-coms then imploded, many Layer 4-7 switch vendors went down with them. Some, such as Alteon and ArrowPoint, were acquired. Others, such as F5 Networks, evolved.

It’s no longer enough to build Layer 4-7 switches that handle static Web traffic. Other capabilities, such as handling security and Web services, are necessary. Phil notes in his article that LAN switch vendors, as opposed to Web switch specialty firms, dominate the overall market today.

F5, which sells application traffic management products, is one vendor that is continuing to grow its business in the Layer 4-7 switch market. The company announced last month that it posted the highest revenue growth of any vendor in the industry, according to a recent report by the Dell’Oro Group.

Sales of F5 Big-IP application switches grew to $12.8 million in the first quarter this year, a 30% increase over the $9.8 million in revenues it reported during the last quarter of 2002. It also marked a 40% increase over revenue reported during the same quarter a year ago, F5 says.

F5 also says that, according to the Dell’Oro Group report, it posted the largest gain in market share, increasing its share of the Layer 4-7 market from about 20% in the previous quarter to nearly 25% in the first quarter.