Large telecoms players lead the IP VPN market

According to IDC, the smaller players still account for two thirds of the market US$2.3 billion market. However, competition will intensify among providers, as demand for VPN services increases.

  • E-Mail
By  Greg Wilson Published  March 6, 2003

The major telecom players are leading the US IP virtual private network (VPN) market in the US, however, they still face serious competition from smaller carriers, specialty VPN service providers, outsourcers and local ISPs. According to IDC, the smaller players still account for two thirds of the US$2.3 billion market.

IDC also predicts that competition will intensify as demand for VPN services increases among businesses of all sizes.

“The biggest competitor to every carrier on IDC's market share list is the internal IT staff of [the] potential customer,” says Steven Harris, research manager for IDC’s IP VPN research program.

“Any carrier or service provider able to provide high quality connectivity and responsive IP VPN service management at low cost and with multiple implementation options will stand to gain significant market shares in the future. The potential universe of competitors is vast and will increase as more providers enter this fast growing market,” he adds.

IDC's analysis indicates that the market leaders at year-end 2002 were AT&T, WorldCom, Savvis, Sprint, and Genuity, in order of revenue generated from IP VPN services. AT&T topped IDC’s market share table.

The major carriers, primarily focused on each other, will continue to fiercely fight over Fortune 1000 customers in the months ahead. This leaves a vast market to smaller carriers, ISPs, VARs, and IP VPN specialists to mop up the medium and small companies that are also deploying IP VPNs in large numbers.

Add a Comment

Your display name This field is mandatory

Your e-mail address This field is mandatory (Your e-mail address won't be published)

Security code