Infonetics: High margins in high speed port sales

April 14, 2011
While high-speed ports (10G, 40G, 100G) represented only 3% of all ports sold by manufacturers in 2010, such ports composed 43% of their revenues, Infonetics Research reports in its newly released 1G/10G/40G/100G Networking Ports market size and forecast report.

While high-speed ports (10G, 40G, 100G) represented only 3% of all ports sold by manufacturers in 2010, such ports composed 43% of their revenues, Infonetics Research reports in its newly released 1G/10G/40G/100G Networking Ports market size and forecast report.

The number of 1G, 10G, 40G, and 100G network ports shipped on service provider and enterprise equipment in 2010 grew 43% versus 2009, to 184 million, and manufacturer revenue grew 26%, to over $33 billion, according to the report, which tracks 1 Gbps, 10 Gbps, 40 Gbps, and 100 Gbps optical and Ethernet ports on enterprise and service provider equipment.

The market research firm expects equipment manufacturer revenue from 1G, 10G, 40G, and 100G networking ports will increase to almost $52 billion in 2015, as enterprises and service providers continue to build out their network infrastructure to respond to growing levels of traffic.

"There is a lot of excitement these days around 100G and 100GbE, and whether or how soon 100G prices will cause 40G sales to decline,” notes Michael Howard, principal analyst for carrier and data center networks and co-founder of Infonetics Research. “The truth is that we are at the start of a very long period where 100G and 100GbE will be the major port player from 2015 through 2030, with bare beginnings of just several hundreds of 100GbE ports on service provider routers shipped to date, and a few inter-city 100G WDM routes deployed. Already street pricing looks very competitive, and with a lot of 100G technology development in motion -- more focused than 40G -- we expect 100G pricing to get to 2X 40G pricing in the 2013 timeframe, which should be the turning point for 100G versus 40G in the service provider market."

Matthias Machowinski, directing analyst for enterprise networks and video at Infonetics Research and co-author of the report, adds, "The market for 1G-and-higher enterprise ports took a bit of a breather in 2009 during the recession, but came back full force in 2010. The enterprise 40G Ethernet port segment will be one of the most interesting to watch going forward, with the first shipments expected in 2011 followed by rapid growth, driven by data center deployments."

Infonetics’ 1G, 10G, 40G, and 100G port report, co-authored by Howard, Machowinski, Andrew Schmitt, and Jeff Heynen, consolidates optical and Ethernet port data from Infonetics services that cover enterprise Ethernet switches, routers, and application delivery controllers, as well as service provider routers, multiservice ATM switches, CES (carrier Ethernet switches), optical gear (WDM and SONET/SDH), PON OLTs, MSAPs, IP DSLAMs, CMTSs, and enterprise (other communications equipment).

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