Ethernet switches and routers are networking devices that connect various local area networks (LANs) and enable data transmission between connected devices at high speeds. Ethernet switches allow devices within the same local network to communicate with one another at speeds of up to 100Gbps to transfer data and multimedia content seamlessly. Routers, on the other hand, allow communication and connectivity between different LANs by routing IP packets between multiple networks. Growing demand for high-speed data transmission and connectivity across industrial, residential, and commercial sectors is fueling the demand for ethernet switches and routers globally.
The global Ethernet Switches and Routers Market is estimated to be valued at US$ 18.26 billion in 2023 and is expected to exhibit a CAGR of 12% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Opportunity:
With increasing digitalization and adoption of cloud computing and internet of things (IoT) solutions across industries, the demand for high-speed data transmission networks is growing at a rapid pace. Ethernet switches and routers provide connectivity within networks and between multiple networks at speeds of 100Gbps and above, allowing seamless transmission of large files, multimedia content, and cloud data. Growing requirements of applications like video conferencing, electronic file sharing, 4k/8k video streaming etc. are propelling the demand for faster network infrastructure. Ethernet switches and routers are increasingly being deployed by enterprises, data centers, educational institutions, and telecom operators to establish high-speed connectivity within premises and between locations. Growing demand for robust and faster connectivity solutions worldwide presents a huge market opportunity for ethernet switches and routers over the forecast period.
Porter’s Analysis
Threat of new entrants: The Ethernet Switches and Routers market has moderate threat of new entrants due to requiring large capital investments to enter the market and established brand names of existing players. However, new players can enter the market by establishing strong distribution networks.
Bargaining power of buyers: Buyers have moderate bargaining power due to the presence of many established vendors offering similar networking products. However, lack of product differentiation increases bargaining power of buyers.
Bargaining power of suppliers: Suppliers have low bargaining power due to the fragmented nature of components used in manufacturing Ethernet Switches and Routers. Suppliers are dependent on vendors for revenues.
Threat of new substitutes: Threat of new substitutes is low as Ethernet Switches and Routers have strong brand recognition and serve specialized networking functions.
Competitive rivalry: The market experiences high competitive rivalry due to tie presence of well-established global and local vendors offering similar and innovative products. This intensifies competition.
SWOT Analysis
Strengths: Growing demand for networking devices from enterprises and data centers. Well-established brands and diverse product portfolios of key players.
Weaknesses: Commoditization of basic switches creates pricing pressure. Rapid changes in technology require continuous investments.
Opportunities: Adoption of advanced technologies like 25/100/400 Gbps speeds. Growing deployments in telecom, government, and transportation sectors. Investments in 5G infrastructure and edge computing.
Threats: Intense competition from global and local vendors. Declining average selling prices (ASPs). Trade barriers and geopolitical uncertainties.
Key Takeaways
The Global Ethernet Switches And Routers Market Demand is expected to witness high growth over the forecast period of 2023 to 2030. Rapid digitalization across industries is the key market driver.
Regional analysis: Asia Pacific will continue dominating the Ethernet Switches and Routers market during the forecast period. Growing infrastructure development, adoption of advanced technologies, and presence of manufacturing facilities of major players in countries like China, Japan, and India will drive the regional market. North America and Europe are also attractive markets driven by high technology adoption rates among enterprises.
Key players operating in the Ethernet Switches and Routers market are Huawei Technologies Co. Ltd., ZTE Corp., Cisco Systems Inc., ADVA Optical Networking SE, Nokia Corporation, Ciena Corporation, Infinera Corporation, Fujitsu Ltd., ECI Telecom Ltd., Telefonaktiebolaget LM Ericsson, NEC Corporation, Juniper Networks Inc., Coriant GmbH, Huawei Marine Networks Co. Limited, NTT Electronics Corporation, Lumentum Operations LLC, Plaintree Systems Inc., Marben Products, Smartoptics AS, Shenzhen HiSilicon Technologies Co. Ltd. The market is consolidated in nature with top players accounting for majority market share. These players are focusing on new product launches, partnerships, and mergers & acquisitions to expand their footprints.
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