Ethernet services thrive despite recession

A study found that Ethernet service revenues totaled US$16.9 billion last year

A gloomy economy hasn't stopped the growth of the Ethernet services industry, as a new study from Infonetics Research  finds that global revenues grew sequentially by 36% in 2008.

Overall, the study found that Ethernet service revenues totaled US$16.9 billion last year and Infonetics says it expects revenue to double to $33 billion by 2013. In addition to strong Ethernet service growth last year, the study also found that global Layer 2 and Layer 3 IP MPLS VPN service revenue increased by 16% in 2008.

Slideshow: Evolution of Ethernet

Infonetics analyst Michael Howard said that the current global recession is actually a reason more companies are adopting Ethernet and IP MPLS VPN services, as adopting those technologies will help them "increase efficiencies and reduce costs." Infonetics says that Ethernet services on average cost between 20% to 30% less than frame relay or private line services, and the research firm also found that North American Ethernet services cost about one-third per megabyte less than DS3s or SONET services

"Organizations are looking to control WAN costs despite rising bandwidth needs by turning to Ethernet, a known cost-per-bit champion," says Howard, who notes that companies are also adding managed Layer 2 and Layer 3 services because "service provider expertise and tools can help stabilize costs, prioritize critical applications and increase capacities."

Although the Ethernet services market has continued to grow during the current recession, the market for Ethernet equipment is not expected to fare nearly as well. A report issued by the Dell'Oro Group earlier this year projected that the Ethernet switch market will undergo its steepest decline in eight years in 2009 and that the market for service provider routers would decline for the first time since 2002.

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Brad Reed

Network World
Show Comments

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

George Khoury

Sharp PN-40TC1 Huddle Board

The biggest perks for me would be that it comes with easy to use and comprehensive programs that make the collaboration process a whole lot more intuitive and organic

David Coyle

Brother PocketJet PJ-773 A4 Portable Thermal Printer

I rate the printer as a 5 out of 5 stars as it has been able to fit seamlessly into my busy and mobile lifestyle.

Kurt Hegetschweiler

Brother PocketJet PJ-773 A4 Portable Thermal Printer

It’s perfect for mobile workers. Just take it out — it’s small enough to sit anywhere — turn it on, load a sheet of paper, and start printing.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?