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The migration of Ethernet technology from the LAN to the metro is beginning to change the way carriers architect their
networks and has the potential to disrupt the base of historical telecom suppliers, according to IDC.
IDC's Worldwide metro Ethernet Equipment Forecast and
Analysis, 2004-2008 reports that the shift is driven by continued
growth in data traffic and sharp declines in the price of LAN switches
and routers.
In just five years old, metro Ethernet has grown to become a
billion dollar market globally. IDC reports that equipment vendors generated $1.1
billion in revenue in 2003 and predicts that equipment revenue will
increase at a 42 percent compound annual growth rate (CAGR) to reach $6.3
billion by the end of 2008. Metro Ethernet represents one of the strongest
opportunities, in terms of both growth and revenue, in
telecommunications.
IDC reported that for the second year in a row, it found that Cisco was the
dominant vendor in the metro Ethernet market, followed by Nortel. In
2003, the two companies combined for 60 percent of the overall market. The
leading metro Ethernet vendors for 2003 were as follows:
Cisco 38.9%
Nortel 21.3%
Extreme 3.6%
Lucent 2.4%
Other 33.8%
"The vendor landscape in metro Ethernet is markedly different from
the overall telecommunications equipment landscape," said Sterling
Perrin, senior analyst, Optical Networks research at IDC, and a
co-author of the study. "Most traditional suppliers, with the
exception of Nortel, are just now entering this market and will
experience a large uphill climb to gain share. However, strength in
metro Ethernet will be critical for traditional suppliers, as this
segment is quickly becoming a major piece of overall service provider
spending."
IDC includes four different equipment types within its definition of metro
Ethernet:
Ethernet over metro wave division multiplexing (WDM)
Ethernet over Synchronous Optical Network/Synchronous Digital
Hierarchy (SONET/SDH) multiservice provisioning platforms (MSPPs)
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