Service Provider Router Revenues Thrive Worldwide in 2016
According to a recent report by Dell’Oro, the service provider router and carrier Ethernet switch industry has witnessed a successful 2016 primarily attributed to strong demand from cloud service providers. This happened despite the fact that the traditional telecom operators trimmed network spending at least for the near-term.
Routers are telecom infrastructure devices used to deliver data packets from one network to another. These are located at gateways, the places where two or more networks connect. In 2016, the aggregate market size of service provider router and carrier Ethernet switch was more than $13 billion.
Phenomenal demand for 100 Gbps Ethernet ports was the main driving force for this record breaking revenue achievement. China played a major roll as cloud service providers of this country were busy installing backbone and data center interconnect networks. Several industry analysts have estimated that the global router market will reach around $72 — $73 billion by 2022.
Massive growth in the usage of mobile devices has heightened transportation of data traffic substantially. In order to manage this burgeoning demand for photo, video and online data services, telecom operators are required to install more routers to ensure smooth transfer of data packets.
In the U.S., majority of demand for service provider router and carrier Ethernet switch are from large cloud service operators like Amazon Web Services of Amazon.com Inc. AMZN , Microsoft Azure of Microsoft Corp. MSFT and Alphabet Inc. GOOGL . All three stocks currently carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
Leading manufacturers of service provider router and carrier Ethernet switch are Juniper Networks Inc. JNPR , Cisco Systems Inc. CSCO , Nokia Corp. NOK and Huawei Technologies.
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Cisco Systems, Inc. (CSCO): Free Stock Analysis Report
Amazon.com, Inc. (AMZN): Free Stock Analysis Report
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