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The ethernet switch and router market is estimated to grow at a CAGR of 2.67% between 2022 and 2027. The size of the market is forecast to increase by USD 6,074.87 million. The growth of the market depends on several factors, including the rising demand for colocation data centres among SMEs, the growing adoption of M2M communication and the increased adoption of cloud-based services.
This report extensively covers market segmentation by product (ethernet switches and routers), application (data centers, carrier ethernet, and others), and geography( North America, Europe, APAC, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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The rising demand for colocation data centers among SMEs is notably driving the ethernet switch and router market growth, although factors such as interoperability issues may impede the market growth. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Key Ethernet Switch and Router Market Driver
The rising demand for colocation data centers among SMEs is a key factor driving the global ethernet switch and router market growth. An enterprise with less than 500 employees is known as an SME. Since the operational costs are high these enterprises are unable to build their own data. Thus, they usually opt for colocation data centers and rent IT infrastructure as per their needs.
Another driver contributing to the growth of the ethernet switch and router market is the adoption of cloud-based services. In network services, protocol handling and radio access network (RAN) functionalities are stored in cloud-based architectures. The data collected can be used to derive optimal insights. Different connectivity platforms are available in the cloud. With the steady deployment of network services by several vendors, the integration of managed network software with cloud computing is expected to increase. Many companies prefer using cloud storage systems offered by service providers, such as AWS, Microsoft Azure, and Google Cloud to reduce operational costs. These drivers are key factors for the adoption of routers and ethernet switches during the forecast period.
Key Ethernet Switch and Router Market Trend
The emergence of 5G will fuel the global ethernet switch and router market growth. After 4G, 5G is expected to dominate the market with a speed of 10,000 Mbps. There have been numerous investments in 5G across the globe. The revenue of 5G network infrastructure across the world grew 39% to a total of USD 19.1 billion in 2021, up from USD 13.7 billion in 2020. With high investment, there is a high demand for 5G worldwide. Telecommunication service providers and network device manufacturers are opting for 5G deployment as quickly as possible. The 5G network will provide ultra-fast Internet connectivity with low latency. This will help companies improve their performance. The key vendors of ethernet switches and routers are increasingly focusing on releasing products. Thus, an increase in investments in 5G will lead the adoption of ethernet switches and routers.
An open switch is another trending product in the Ethernet switch Market. Open Ethernet switches include only the hardware of switches that are produced by original device manufacturers (ODMs). They are sold to end-users without installing any operating systems. Operating systems are offered by enterprises such as Cumulus Networks and Big Switch Networks. End users save their costs by purchasing hardware and software separately. These are the key factors for the growth of the global ethernet switch and router market during the forecast period.
Key Ethernet Switch and Router Market Challenge
Interoperability issues are a major challenge to the global ethernet switch and router market growth. The construction of network infrastructure is difficult, and the installation process involves many complex steps which are difficult to implement on the ground level. The complexity increases while building network infrastructure for SMEs. End-users depend heavily on solid network infrastructure to deal with their daily operations. Any disruptions in the operations hinder the workflow of the end users. Thus, routers and switches need to provide high-speed connectivity which can become a challenge during some crucial situations.
The possibility of mesh router hampering the ethernet switch and router market is high as the mesh router is preferred by many. A mesh router is a device that uses high-frequency radio waves and often includes access points that increasingly rely on LANs for internal and external communications. Mesh routers are used in large places, such as military bases and businesses, to safeguard important information. Mesh routers have multiple access points spread across an area to enhance the range and performance of Wi-Fi. The adoption of mesh routers will decrease the deployment of routers and increase the adoption of access points and wireless LAN (WLAN) devices. These factors can slow down the ethernet switch and router market growth.
Key Ethernet Switch and Router Market Customer Landscape
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Ethernet Switch and Router Market Customer Landscape
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Juniper.net - The company offers ethernet switches and routers such as Intel Ethernet Switch FM4410, EZFM2112F897C S LKJE, and AXXSW1GB. Also, under this segment, the company offers network management software, network security products, software-defined networking technology, and many more.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market share growth by the ethernet switches segment will be significant during the forecast period. Ethernet switches are further segmented into modular switches and fixed-configuration switches. Modular switches at basically used in households. Modular switches are available in different appealing designs, colours, and styles. Modular switches are designed to complement the interiors of living rooms and offices. Furthermore, these switches allow users to add expansion modules to switches whenever needed.
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The ethernet switches segment showed a gradual increase in market share from USD 25,477.79 million in 2017 and continued to grow by 2021. Additionally, ethernet switches are available in the latest variety of modular switches. These switches are convenient, safe, and easy to use. Modular switches are considered relatively safer because these switches are free from metallic parts on the switchboard and, therefore, minimize the risk of electrical shocks. Due to these factors, the demand for modular switches is expected to grow during the forecast period.
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North America is projected to contribute 42% by 2027. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
North America dominates the global ethernet switch and router market because of the increased adoption of data centers that are operated by cloud service providers (CSP), telecommunication service providers, enterprises, and governments. The construction of new data centers and renovation of existing data centers in the US will likely contribute to the region's share during the forecast period.
The report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027. The market has been segmented by type, product, distribution channel, and region.
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Ethernet Switch and Router Market Scope |
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Report Coverage |
Details |
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Page number |
167 |
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Base year |
2022 |
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Historic period |
2017-2021 |
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Forecast period |
2023-2027 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 2.67% |
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Market growth 2023-2027 |
$ 6074.87 million |
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Market structure |
Fragmented |
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YoY growth (%) |
1.61 |
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Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
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Performing market contribution |
North America at 42% |
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Key countries |
US, China, Taiwan, France, and Germany |
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Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
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Key companies profiled |
Adtran Inc., Arista Networks Inc., Broadcom Inc., Cisco Systems Inc., D Link Corp, Dell Technologies Inc., Extreme Networks Inc., Huawei Technologies Co. Ltd., Intel Corp., Juniper Networks Inc., Netgear Inc., New H3C Technologies Co. Ltd., Nokia Corp., Telefonaktiebolaget LM Ericsson, Tellabs Access LLC, TP Link Corp. Ltd., TRENDnet Inc., ZTE Corp., Hewlett Packard Enterprise Co., and Plantronics Inc. |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Product
7 Market Segmentation by Application
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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