U.S. enterprises and consumers are expected to spend more than $37 billion over the next five years on Carrier Ethernet services, according to a recent market research study from The Insight Research Corp.
With metro-area and wide-area Ethernet services readily available from virtually all major data service providers, the market is expected to grow at a compounded rate of almost 25 percent, increasing from $3.1 billion in 2010 to reach nearly $9.7 billion by 2015.
According to Insight Research’s study, the economic recession that emerged in late 2008 has not dampened U.S. enterprises appetite for Ethernet services. Insight is projecting the surge in demand will peak by 2011 as the economy improves Ethernet revenue growth rates hit 29 percent on a compounded annual basis.
Ethernet services are marketed under various names: transparent or native LAN, Ethernet, Gigabit Ethernet, GigE, metro Ethernet, Ethernet private line, Ethernet virtual private line, Layer 2 virtual private network, Ethernet access, and virtual private LAN service.
“The momentum behind retail sales of Ethernet services to the enterprise is being driven by the customer’s steadily increasing demand for data bandwidth and Ethernet’s real cost advantages in terms of providing flexible bandwidth and scalability that is superior to many competitive services,” said Robert Rosenberg, president of Insight Research, in a press statement.
However, the research firm also noted in an executive summary for the report that despite the accelerating pace of Ethernet adoption, the technology will not imminently take over the world.” Customers will not abandon their current services as long as they meet their needs. Older data services will retain a gradually subsiding role for an indefinite periodcertainly through 2015, the end of our forecast period,” the summary stated.