Industry News
Forecast: The service provider router market will continue to grow in the next five years
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Author : JIUZHOU
Update time : 2023-02-10 12:11:33
According to the forecast, from 2022 to 2027, the service provider router and switch market will grow at a compound annual growth rate of 2%. Widespread adoption of products based on 400Gbps technology will continue to be a key driver for the growth of this market.
According to a recent report released by a certain group, the service provider (Service Provider, SP) router and switch market will grow at a compound annual growth rate (CAGR) of 2% from 2022 to 2027. According to estimates, by 2027, the cumulative revenue of the global SP router and switch market will be close to 77 billion US dollars. Widespread adoption of products based on 400Gbps technology will continue to be a key driver for the growth of this market. Telecom and cloud service providers will continue to invest in network upgrades to meet growing traffic demands and benefit from the economics of 400 Gbps technology.
"Our growth forecast remains largely unchanged from previous forecasts," said a senior analyst. "In the first few years of the forecast period, market uncertainty will continue as economists expect a recession in Europe and North America to be likely. However, on the assumption that the fundamentals of the SP router market remain healthy, we expect the global SP router and switch market to stabilize in the second half of the forecast period.”
Highlights from the SP Router and Switch Five-Year Forecast Report, January 2023:
1. Built on the latest generation of high-capacity ASICs, routers supporting 400Gbps have higher speed per port and lower power consumption, thereby reducing the total number of ports required, which in turn reduces the size of the chassis. The higher speed per port also reduces the cost per bit per port. Combined with reduced power consumption and a smaller rack-space-saving router format, the transition to 400Gbps ports enables service providers to make more cost-effective investments and reduce operating costs.
2. In the SP core router segment, revenue will grow at a CAGR of 4% from 2022 to 2027, driven by 400Gbps technology adoption.
3. The SP edge router and SP aggregation switch market is expected to grow at a CAGR of 1% to nearly $12 billion by 2027. The main growth driver in this segment will continue to be the expansion of mobile backhaul networks to support the adoption of 5G radio access network (RAN), followed by increased deployment of residential broadband.
4. It is expected that China's IP mobile backhaul market will decline, and SP will shift its investment to core and metropolitan area networks, so the demand for SP core router products is expected to increase.
According to a recent report released by a certain group, the service provider (Service Provider, SP) router and switch market will grow at a compound annual growth rate (CAGR) of 2% from 2022 to 2027. According to estimates, by 2027, the cumulative revenue of the global SP router and switch market will be close to 77 billion US dollars. Widespread adoption of products based on 400Gbps technology will continue to be a key driver for the growth of this market. Telecom and cloud service providers will continue to invest in network upgrades to meet growing traffic demands and benefit from the economics of 400 Gbps technology.
"Our growth forecast remains largely unchanged from previous forecasts," said a senior analyst. "In the first few years of the forecast period, market uncertainty will continue as economists expect a recession in Europe and North America to be likely. However, on the assumption that the fundamentals of the SP router market remain healthy, we expect the global SP router and switch market to stabilize in the second half of the forecast period.”
Highlights from the SP Router and Switch Five-Year Forecast Report, January 2023:
1. Built on the latest generation of high-capacity ASICs, routers supporting 400Gbps have higher speed per port and lower power consumption, thereby reducing the total number of ports required, which in turn reduces the size of the chassis. The higher speed per port also reduces the cost per bit per port. Combined with reduced power consumption and a smaller rack-space-saving router format, the transition to 400Gbps ports enables service providers to make more cost-effective investments and reduce operating costs.
2. In the SP core router segment, revenue will grow at a CAGR of 4% from 2022 to 2027, driven by 400Gbps technology adoption.
3. The SP edge router and SP aggregation switch market is expected to grow at a CAGR of 1% to nearly $12 billion by 2027. The main growth driver in this segment will continue to be the expansion of mobile backhaul networks to support the adoption of 5G radio access network (RAN), followed by increased deployment of residential broadband.
4. It is expected that China's IP mobile backhaul market will decline, and SP will shift its investment to core and metropolitan area networks, so the demand for SP core router products is expected to increase.
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