U.S. enterprises and consumers are expected to spend more than $37 billion over the next five years on Ethernet services provided by carriers, according to analysts at Insight Research Corporation.
Sales of carrier Ethernet services are expected to reach $3.1 billion by the end of 2010, growing steadily at nearly a 25-percent compound average growth rate to reach $9.7 billion in sales in 2015.
Perhaps significantly, a major additional factor contributing to growth over the next several years will also be the large-scale migration of wireless backhaul from TDM to Ethernet. Growth is re-accelerating from a modest slowdown tracking with the recent economic crisis and its aftermath, and is projected to reach another peak of 29 percent in 2011.
Carrier Ethernet services, were a $2.4 billion market in 2009.
Of course, to a certain extent Ethernet services also will simply cannibalize existing sales of private line, ATM and frame relay circuits. Insight Research expects to see customers continue to leave private line and frame relay for Ethernet, as well as placing new applications on Ethernet, rather than expanding their use of legacy services.
While business customers are particularly likely to adopt public Ethernet for new applications, locations, and incremental bandwidth, the majority of the migration to Ethernet has and will
come from legacy services like frame relay and private line.
For such reasons, the $34 billion private line services market is entering a period of declining revenue, Insight Research also says.
U.S. enterprises and consumers are expected to spend more than $37 billion over the next five years on Ethernet services provided by carriers, according to analysts at Insight Research Corporation.
Sales of carrier Ethernet services are expected to reach $3.1 billion by the end of 2010, growing steadily at nearly a 25-percent compound average growth rate to reach $9.7 billion in sales in 2015.
Perhaps significantly, a major additional factor contributing to growth over the next several years will also be the large-scale migration of wireless backhaul from TDM to Ethernet. Growth is re-accelerating from a modest slowdown tracking with the recent economic crisis and its aftermath, and is projected to reach another peak of 29 percent in 2011.
Carrier Ethernet services, were a $2.4 billion market in 2009.
Of course, to a certain extent Ethernet services also will simply cannibalize existing sales of private line, ATM and frame relay circuits. Insight Research expects to see customers continue to leave private line and frame relay for Ethernet, as well as placing new applications on Ethernet, rather than expanding their use of legacy services.
While business customers are particularly likely to adopt public Ethernet for new applications, locations, and incremental bandwidth, the majority of the migration to Ethernet has and will come from legacy services like frame relay and private line.
For such reasons, the $34 billion private line services market is entering a period of declining revenue, Insight Research also says.
by Gary Kim
