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!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Brad Reed

Network World
Show Comments

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Jack Jeffries

MSI GS75

As the Maserati or BMW of laptops, it would fit perfectly in the hands of a professional needing firepower under the hood, sophistication and class on the surface, and gaming prowess (sports mode if you will) in between.

Taylor Carr

MSI PS63

The MSI PS63 is an amazing laptop and I would definitely consider buying one in the future.

Christopher Low

Brother RJ-4230B

This small mobile printer is exactly what I need for invoicing and other jobs such as sending fellow tradesman details or step-by-step instructions that I can easily print off from my phone or the Web.

Aysha Strobbe

Microsoft Office 365/HP Spectre x360

Microsoft Office continues to make a student’s life that little bit easier by offering reliable, easy to use, time-saving functionality, while continuing to develop new features that further enhance what is already a formidable collection of applications

Michael Hargreaves

Microsoft Office 365/Dell XPS 15 2-in-1

I’d recommend a Dell XPS 15 2-in-1 and the new Windows 10 to anyone who needs to get serious work done (before you kick back on your couch with your favourite Netflix show.)

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?