LAN Equipment Market Navigates the Obstacles in 4Q99, According to IDC

FRAMINGHAM, MASS. — 02/24/2000 — Despite Y2K and declining prices, the momentum in the worldwide local area network (LAN) equipment market continued in the fourth quarter of 1999. According to IDC, which today released results from its WW LAN QView product, most markets increased their revenues.

"Fourth-quarter market data clearly indicates investment in LAN equipment continues to move forward," said Esmeralda Silva, director of Enterprise Networks research at IDC. "However, declining prices and Y2K restraint did impact the overall growth of certain LAN equipment segments. We expect growth to accelerate during the first quarter of this year as spending on networking equipment resumes its normal pace and vendors find new growth markets in which to sell LAN switches and routers. In particular, the service provider and ebusiness data center segments represent two opportunities currently being targeted by network equipment suppliers."

Highlights from the quarter include:

–Worldwide LAN switch end-user revenue expanded to $3.9 billion.

–Worldwide Layer 3 switches accounted for 1.469 million ports and $937 million in end-user revenue in 4Q99.

–Worldwide Gigabit Ethernet switches represented 479,572 ports and $534 million in revenue.

–Worldwide router end-user revenue increased to $2.4 billion in 4Q99.

–The pace of Gigabit router installations has picked up significantly, jumping to 1,479 units. The quarter also marked the first shipments of Terabit routers sold by Avici Systems.

–The biggest growth in the router segment came from sales of SOHO routers, which grew 20.5% over the previous quarter. However, the SOHO segment is still relatively small, accounting for only 12% of the total quarterly revenue.

Supported by a team of IDC LAN market analysts around the world, IDC’s WW LAN QView was launched in response to customer demand for timely, detailed, and accurate LAN equipment market results. IDC’s WW LAN QView data is segmented by technology, form factor, function, region, price band, and customer, where applicable; delivered eight weeks after the close of a calendar quarter; and made available to clients in an easy-to-review electronic format.

Electronic market reports detailing IDC’s 4Q99 WW LAN QView results for the LAN switch, router, and hub markets are available for purchase now. The purchase price of these reports will be credited to any organization that subscribes to the WW LAN QView service.

For more information on IDC's WW LAN QView service, contact Jonathan Guloyan at 508-935-4296. To purchase the electronic copy of IDC’s 4Q99 WW LAN QView results, please contact Bruce Atlas at 1-800-343-4952 extension 4053 or by email at batlas@idc.com.

About IDC

IDC delivers dependable, relevant, and high-impact data and insight on information technology to help organizations make sound business and technology decisions. IDC forecasts worldwide IT markets and technology trends and analyzes IT products and vendors, using a combination of rigorous primary research and in-depth competitive analysis. IDC is committed to providing global research with local content through more than 500 analysts in 43 countries worldwide. IDC's customers comprise the world's leading IT suppliers, IT organizations, and the financial community. Additional information can be found at http://www.idc.com.

IDC is a division of International Data Group, the world's leading IT media, research, and exposition company.

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