Well in excess of $100 B will be spent on campus switches over the next five years, according to a new report from Dell'Oro Group. After experiencing three strong years in campus switch sales, we foresee a significant correction in 2024, followed by a subsequent period of improved growth trajectory throughout our forecast horizon.
“Backlog normalization, capacity digestion, and spending optimization are all expected to hit the market in 2024,” said Sameh Boujelbene, Vice President at Dell’Oro Group. “Additionally, the recently announced HPE/Juniper acquisition may further depress sales performance this year and possibly even next year, since customers will be awaiting more clarity on post-acquisition roadmaps. We currently project a double-digit decline in campus switch sales in 2024.
“Despite such a steep anticipated sales decline in 2024, our analysis showed that the pandemic has effectively accelerated the growth in the campus switch market between 2019 and 2024, compared to the preceding five years. This positive impact was propelled by several factors including an accelerated pace of digital transformation, a greater portion of high-priced Power-Over-Ethernet (PoE) devices, and the need for faster network speeds. We predict these factors will persist in the campus switch market and will drive better days ahead of us,” added Boujelbene.
Additional highlights from the Ethernet Switch – Campus 5-Year January 2024 Forecast Report:
- The integration of Artificial Intelligence capabilities will remain pivotal for vendors striving to enhance their competitive positioning in the market. Nonetheless, the challenge lies in whether these vendors can effectively monetize these features or opt to leverage them for expanding and/or retaining their customer base.
- 5/5.0 Gbps is expected to comprise less than 15 percent of campus switch sales by 2028.
- PoE ports are forecast to comprise more than half of total campus switch port shipments by 2028.
- IT/OT convergence is expected to increase over our forecast horizon, but adoption may take time given the very long 10-30-year lifecycle of industrial networking equipment.
https://www.delloro.com/news/campus-switch-sales-to-surpass-100-b-between-2024-and-2028/
