Just how big is the worldwide LAN market today?
We give you the breakdown on growth for hubs and switches, routers, and network interface cards
Boston (02/05/97) -- Users worldwide spent more than US$15 billion on LAN equipment last year, with LAN switching, Fast Ethernet, and other new higher-speed technologies a major draw, according to International Data Corp.
The overall market grew more than 20 percent, from $12.5 billion in 1995 to more than $15.2 billion in 1996. Traditional markets, such as shared-media hubs, eroded last year, as customers moved to LAN switching. Over the coming year, IDC expects the growth of newer technologies to continue, as more customers use multilayer switching, as well as Fast Ethernet, Asynchronous Transfer Mode (ATM), and Gigabit Ethernet products.
"1997 is really the year that all of these technologies are going to be growing pretty substantially," said Esmeralda Silva, senior analyst at IDC.
The following is IDC worldwide market data on several product areas:
Chassis-based Ethernet hub sales have declined, although they still account for $900 million in sales. In the coming year, customers are expected to migrate from shared media systems to a LAN switching architecture.
Stackable Ethernet hub shipments grew to 23.9 million ports and $1.2 billion in sales. Unmanaged Ethernet hub shipments also grew to more than 14 million ports, but they only brought in $213 million in sales; per port pricing has dropped to under $15 per port from some vendors.
Token Ring shipments dropped from 5.4 million ports in 1995 to 5.2 million ports in 1996. Sales are expected to continue to the installed base, but those customers are also looking at migrating to LAN switching and ATM.
Fast Ethernet hub shipments grew nearly five times, from 232,000 ports in 1995 to more than 1.3 million ports in 1996. FDDI concentrator shipments grew 33 percent, to 384,000.
Cisco remains on top of the router market, with 55 percent of shipments and 65 percent of revenues. Cisco is followed by Bay Networks Inc. and 3Com.
Direct sales made up 27 percent of shipments, a 1-point increase over 1995. VARs and resellers made 53 percent of shipments, down from 57 percent in 1995. Distributors made 17 percent of shipments, up from 14 percent in 1995. Original equipment manufacturers made up 4 percent of shipments, up from 3 percent in 1995.
PC Card NIC shipments amounted to nearly 1.6 million units during the first half of last year, nearly double the number of shipments in the first half of 1995; multifunction cards showed strong growth, and total PC Card NIC shipments will likely be more than 3.7 million units. Network-ready (Ethernet on motherboard) PC shipments grew to about 5 million units, up from 4 million last year, and for now, do not seem to be an immediate threat to NIC shipments. Meanwhile, NICs are being installed on more and more servers and desktop PCs during the final assembly.
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