Cisco continues to lose market share in IP edge segment

Cisco is losing its market share in IP edge segment. Alcatel-Lucent, Huawei, Juniper and even ZTE continue to take market share from Cisco in the critical IP edge segment (the sum of IP edge routers and carrier Ethernet switches), according to Infonetics Research.

Cisco is doing well, with global IP edge revenue up 12 percent in the second quarter of 2011, and still commands close to a third of the worldwide market. The problem is that Cisco’s competitors are growing faster,” said Michael Howard, principal analyst for carrier networks at Infonetics Research.

Huawei’s IP edge revenue grew 66 percent and Alcatel-Lucent’s 22 percent in 2Q11. Over the last year and a half (1Q10 to 2Q11), Cisco’s IP edge revenue share declined from a high of 41.5 percent to 32.2 percent, while its closest competitors gained between 2 and 5 percentage points of share.

Alcatel-Lucent and Huawei have end-to-end portfolio solutions for broadband and mobile networks, and, according to Infonetics Research surveys, many service providers see Juniper and ALU as offering competitive technology at a better price point.

Meanwhile, ZTE is growing in the mobile space, particularly mobile backhaul. For these and other reasons, these manufacturers are winning big deals in the IP edge space and gaining on Cisco.

The total service provider router and switch market is up 14 percent sequentially to $3.8 billion worldwide. Year-over-year, the carrier router and switch market is up 19 percent.

In 2Q11, the IP edge segment (IP edge routers and carrier Ethernet switches) jumped 15 percent sequentially and 21 percent year-over-year (from 2Q10), now making up 78 percent of the total market

Asia Pacific and North America contributed most of the overall market’s lift in 2Q11; CALA (Central and Latin America) was up slightly and EMEA (Europe, Middle East, Africa) contracted a bit.


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