The FINANCIAL — According to IDC’s (International Data Corporation) APeJ Quarterly Switch and Router tracker, the Ethernet Switch market clocked end-user revenue of USD 127.1 million during Q2 2015, with an increase quarter-on-quarter (2.5 percent) but marginal de-growth year-on-year (1.1 percent). The Router market stood at USD 68.3 million, a flat market year-on-year and decline of 4.3 percent quarter-on-quarter in terms of end user revenue.
The Networking market in the next few quarters is betting big on the Government sector, given the increased ICT interest from around the world to invest in India. CY 2014 was one of the best years for the Networking market (LAN and WLAN included) in India (with over 20 percent growth year on year and a similar pattern is expected in CY 2015 as well on the back of government initiatives and organizations willing to invest in future technologies.
The key vendors in the LAN market were Cisco, Juniper, HP, Huawei and Alcatel-Lucent, contributing over 80% to the revenues during 2Q 2015. Cisco retained its dominance in the Switch & Router market. The key growth verticals for the vendor in Q2 were Telcos, BFSI and Manufacturing, with Telecom remaining to be the most promising vertical (growth-wise) for the next few quarters as well. Juniper’s growing interest and reach in the SMB space is working in their favour. For HP, lot of expectations are set with the Aruba’s acquisition, given high presence of the latter in the large enterprise segment. During Q2 as well, Huawei leveraged on the refresh and otherwise deals from Telco’s enterprise business. Deals from existing clientele were the major contributor to Alcatel-lucent, similar to the the previous quarter. Third Platform has been a buzz word lately, driving enterprises to leverage their workforce, operations and customer experience to achieve optimization. Telcos are in full rush to get maximum customers on board for their 3G/LTE networks, reasoning high competition from both incumbent and new players. These factors along with Government’s frequent announcements in the direction of ‘Digital India’ are likely to give boost to the ICT market during 2015 and further.
High proportion of young population, influence of social media, increasing data-based applications, improving mobility, and thriving SMBs sum up to push the market in the upcoming quarters. Significant opportunities around digital infrastructure are likely to emerge for vendors and their channel partners in the near foreseeable future. Network enabled campuses, broadband highways, Wi-Fi hotspots will remain the key to digital infrastructure development and rollouts. Moreover, the proliferation of smart devices and their tech-savvy infrastructure has created opportunities for all kinds of players to leverage increasing future demand.
The WLAN market in India clocked an 8.4 percent growth quarter-on-quarter and 37.9 percent year-on-year during Q2 2015, according to IDC’s Quarterly APeJ Wireless LAN tracker and registered USD 53.1 million as end-user revenue. Since Q2 2014, the WLAN market is increasing both quarter-on-quarter and year-on-year with the highest revenue ever coming in CY 2014. Telco-WLAN as a medium for better coverage is now taking a backseat with Wi-Fi/Hotspots now being considered to drive new revenue streams, given decreasing ARPU from the traditional usage. Further, Government-led hotspots in the popular tourist spots, railway stations and expressways are acting as another driver for the WLAN market, besides the regular demands from the verticals like Education and IT/ITeS. Education still contributes largely to the WLAN market with investments from new universities and colleges as well the old ones towards the upgrade/refresh.
Suman Bisht, Market Analyst – Enterprise Networking says, “With the official launch of “Digital India” program, both public and private owned organizations are contemplating the idea of getting digitized at all levels. On the same lines, government’s IT investments are likely to grow in 2015. With over 7 million SMBs and counting, aggressive expansion and growth plans by most of them are expected to further consider mobility and network optimization solutions that are expected to result in the growth of this market. The IP-based security-surveillance market is also likely to take a faster route giving vendors, small or big, an opportunity to grow. Traditional segment is set to benefit from mobility and network optimization solutions.”
Gaurav Sharma, Research Manager – Enterprise (India) says, “Manufacturing, Hospitality and Utilities verticals are expected to spend more on the Networking infrastructure in the coming quarters. The e-part of the business has raised an immense possibility for the ICT industry across hardware, software and services. Growing investments from government, both central and state, are very much on the cards, given the rising demand for connectivity, accessibility and surveillance needs of the country. Solutions such as BYOD, Traffic Offloading, Surveillance and IoT are beginning to be visible in the market where they are able to contribute a sizeable and noticeable revenue. “