Ethernet market slides

While the worldwide Ethernet switch market shrank last quarter, market leader Cisco Systems Inc. grew its share of the pie by six per cent, while 3Com Corp. saw its Gigabit Ethernet business skyrocket, according to recent figures from the Dell’Oro Group Inc.

The US$2.65 billion in worldwide sales of Ethernet switch ports in the first quarter of 2002 was down four per cent from the previous quarter. Cisco took the opportunity of the down market to increase its share of switch sales. Most other vendors, with exception to Extreme Networks Inc., lost share during the quarter.

Cisco grew its market share from 60 per cent of Ethernet switch port revenue in the fourth quarter of 2001 to 66 per cent in the first quarter of 2002. Nortel remained in at a distant second with 5.7 per cent of the market, down 1.8 per cent from the previous quarter. 3Com and Extreme were tied for third with around 4.2 per cent of the market each. Recent administrative shakeups and financial troubles at Enterasys Networks were reflected in terms of market share, as the company out of the top three vendors with less than three per cent market share, down two per cent from the fourth quarter of 2001, when it was in third-best seller of Ethernet switches.

The market for Gigabit Ethernet products grew by one per cent from the fourth quarter of 2001 to the first quarter of this year. The slow growth in the first quarter of 2002 Gigabit revenue did not mean a slowdown in Gigabit Ethernet technology adoption, as 1.5 million Gigabit ports were shipped, up 10 per cent from the previous quarter.

Cisco was also a winner in Gigabit Ethernet sales with 10 per cent growth during the quarter and remained the top vendor for 1000G bit/sec switches, which represent around three per cent of the total Ethernet market. Nortel, Extreme and Foundry, which placed second, third and fifth place in the market respectively, all saw their Gigabit sales shrink. Meanwhile fourth-place 3Com saw its Gigabit Ethernet sales shoot up with 27 per cent growth during the quarter.

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