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Global Network Equipment Industry Analysis

The world network equipment industry is a segment of the telecommunication services market and is expected to exceed $184 billion in 2015, according to research from MarketLine, representing a near 34% increase compared to 2010. Switches and routers represent the leading market segment, generating close to 45% of overall market value. The EU represents almost 40% of the global networking equipment market.

The industry encompasses the manufacture, sale and provision of integrated telecom products and networking equipment, including data routing and switching devices, interconnects and equipment to link workstations with local area networks and wide area networks.

Key Market Segments

The global radio frequency identification (RFID) industry is forecast to expand at a yearly rate of more than 15% between 2011 and 2013 to exceed $9.5 billion, according to RNCOS. Verticals applications built up around RFID technology are fueling the market. Asia-Pacific is set to record the fastest rate of growth, forecast to represent more than 25% of the global RFID market by 2013. In Germany, the market is forecast to grow at a yearly rate of close to 20%. The market serves other industries, that of retail and logistics in Asia Pacific for example, as well as identification and access monitoring in the EU. RFID technology is also used in verticals like consumer packaged goods and transportation.

Visiongain estimates the carrier Ethernet sector will expand at a yearly rate of 28% in the US between 2011 and 2016. Despite declines in other telecom industry sectors, carrier Ethernet recorded growth during the economic downturn. Ethernet types include copper, optical and microwave, and are used across a wide range of sectors, with strong demand in homes and companies. Ethernet revenue growth in the nations of Brazil, Russia, India and China is expected to be as much as 90% yearly in certain regions.

The global network attached storage (NAS) device industry is expected to exceed $7 billion by 2017, according to Global Industry Analysts. As companies recover from the economic recession, server systems and storage will be reviewed, driving demand for NAS devices, which consist of networked storage technology, facilitating data sharing across systems connected to a common host. Both NAS and storage-area network (SAN) technologies are in demand from companies needing to update their area network infrastructure. Advantages of NAS technology include higher server performance, end-user transparency, independence from platforms, improved data access, and cheaper installation and maintenance. Key players operating in the global NAS device market include Dell, Buffalo, Hitachi Data Systems, SGI, Panasas, BlueArc, LSI, Pillar Data Systems, International Business Machines, NetGear and NetApp.

The global Gigabit Ethernet (GbE) market is expected to reach almost $6 billion by 2017, reports Global Industry Analysts. The market is fuelled by rising demand for more rapid computer networking transmission due to increasing network technologies and widespread bandwidth heavy multimedia content. Transmission speeds are becoming faster and faster, currently at more than 100 gigabits per second, to facilitate business activity, which will continue to push the GbE market in coming years.

Regional Markets

Hoovers estimates there are around 1,000 companies operating in the US computer networking equipment market, generating close to $50 billion. Cisco Systems, Brocade Communications and Juniper Networks are three major players on the market.

Park Associates reports that less than 10% of US homes using broadband use online backup, leaving room for the US network-hosted storage solutions market to expand as consumers seek to protect their content. The market is likely to widen from purely backup solutions to encompass links with mobile devices, content sharing and cloud media services.

MarketLine estimates the Asia-Pacific networking equipment industry reached almost $27 billion in 2010; the market is expected to grow at a yearly rate of almost 6.5% between 2010 and 2015 to exceed $36.5 billion.

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