Ethernet switching market hits US$2.9 billion

Worldwide Ethernet switching shipments for the third quarter of 2002 have increased by 21.7% compared to the same period last year, and the total number of units shipped almost topped the 40 million mark.

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By  Matthew Southwell Published  December 3, 2002

Worldwide Ethernet switching shipments for the third quarter of 2002 have increased by 21.7% compared to the same period last year, and the total number of units shipped almost topped the 40 million mark. Despite these gains, however, analysts at Gartner Dataquest report that revenues have not grown as quickly, with worldwide revenues increasing only 1.3% for the third quarter to US$2.9 billion.

On the vendor front, Cisco continued to dominate the market with 72.9% of worldwide Ethernet switching revenue and 41% of port shipments, while 3Com leapt from the number five position to number two based on revenue. Nortel, Extreme and Foundry fill out the remaining top five positions.

In terms of technology, several vendors, including Cisco, 3Com and Hewlett-Packard, have introduced fixed configuration Layer 3 switches with gigabit ports during the third quarter of 2003. Targeted primarily at the aggregation layer of midsize and large enterprises, Layer 3 switches accounted for 13% of total Ethernet switches port shipments and 48% of manufacturer revenue.

“The [Layer 3] switches are competitively priced in comparison to the Layer 2 switches. They are becoming increasingly popular among enterprises looking for a cost-effective solution with a limited budget, and yet protect their investment for deploying newer applications such as video and Internet Protocol (IP) telephony,” comments Rachna Ahlawat, senior analyst for Gartner Dataquest's enterprise networking & communications worldwide group.

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