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Router market skid halted during the past quarter: SRG

The total router market seems to have stopped sliding, findings from Synergy Research Group Inc. reveal. During the...


September 3, 2002  


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The total router market seems to have stopped sliding, findings from Synergy Research Group Inc. reveal. During the past three months, the total market only declined five per cent compared to 22 per cent in the last quarter.

In the low-end router segment, SOHO routers declined four per cent while Branch Office routers increased eight per cent in a quarter-to-quarter comparison. Additionally, Mid-range routers increased two per cent in the quarter.

Cisco Systems Inc., which increased Branch Office sales by 10 per cent said that customers are planning major office upgrade cycles to build for convergence, security, and distribution of applications. "Enterprise networks need to be renovated and vendors who provide the best ROI will lead the market," said Susana Vidal, Industry analyst at Synergy Research Group.

The need to provide applications is also driving the investments in the Service Provider Edge sub-segments. While Broadband Aggregation continued to decline (15 per cent sequentially), IP Services Equipment only went down 2 per cent. According to SRG, the IP Services segment is anticipated to grow as Service Providers try to find ways to increase their revenue stream and as customers seek multipurpose solutions that will not dramatically affect their cash flow.

In terms of overall market share, Cisco was the leader for the quarter followed by Juniper Networks Inc. and Redback Networks Inc.

"Iin difficult times like this, a strong brand coupled with efficient distribution channels can make all the difference," the report concluded. "Nonetheless, Redback has been able to increase its position in the market by presenting a great business case for its edge solutions by focusing on capital cost and virtual routing capabilities."

Based in Phoenix, SRG specializes in quarterly market analysis, market share, forecasting, and strategic consulting.


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