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Ethernet Switch Market Growth Forecast

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REDWOOD CITY, Calif., July 31 -- Steep price declines in Gigabit and 10-Gigabit Ethernet will result in strong port shipment and revenue growth within these two segments, according to a report from Dell'Oro Group. The report predicts that these technologies combined will grow to comprise 65 percent of total Ethernet switch revenues in 2007, versus 29 percent in 2002.

"Starting in late 2003, we anticipate that we will see prices within a number of Gigabit Ethernet sub-segments low enough to entice customers to upgrade their desktop connectivity purchase decisions from fast Ethernet. In the face of tightened information technology budgets, however, and without many compelling application drivers for Gigabit Ethernet as a desktop connection, we anticipate a longer migration to this technology. Consequently, our forecast for Gigabit Ethernet adoption is that it will be much more gradual compared to the transition to fast Ethernet," said Seamus Crehan, a senior analyst at Dell'Oro Group.

As a result of 10-Gigabit Ethernet achieving a significant price-performance advantage over similar high-end Gigabit Ethernet ports by 2005, it will become an attractive substitute for Gigabit Ethernet in Enterprise backbones, inter-campus connections and data centers, the report says.

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Jul 2003
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