Bengaluru, NFAPost: According to the latest IDCs lattest tracker report, India’s networking market which includes Ethernet Switch, Routers, and WLAN segments witnessed a 9.6% year-over-year (YoY) decline in Q2 2020 (April – June 2020).
The report finds that the primary reason for the shrink in demand is primarily due to India’s networking market witnessed a decline in verticals like banking, telecommunications, and professional services.
India’s networking market witnessed a 9.6% year-over-year (YoY) decline in Q2 2020 (April – June 2020). IDC expects Q3 (July-September 2020) to also follow the same trendline due to the lack of business activity in Q2 translating into declined shipments.
While Wi-Fi 6 has started to gain significant traction in India, the overall WLAN market declined by 4.6%. The sudden demand in consumer gateway routers could be attributed to employees working from home and students taking online classes during the lockdown.
Decline in the switch market was mainly due to a reduction in investments for campus infrastructure. Business was characterized by regular refreshes from verticals like banking, telecommunications, and professional services. Router market saw a decline of 5.5% YoY; however, the quarter-over-quarter (QoQ) decline was only 1.2%. The spending from telecom vendors to support remote working needs majorly contributed to the business in this segment.
While Wi-Fi 6 has started to gain significant traction in India, the overall WLAN market declined by 4.6%. Though the enterprise WLAN market saw a significant decline, the decline was offset by the growth of consumer gateway routers. The sudden demand in consumer gateway routers could be attributed to employees working from home and students taking online classes during the lockdown.
Commenting on the development, IDC India Enterprise Networking Senior Market Analyst Sudharsan Raghunathan said the business verticals are impacted by the Covid-19 pandemic.
“Given the impact of the pandemic, vendors are focusing around building cloud-based management and orchestration layers (compatible with multiple cloud platforms) that provide unified management across all the devices under their portfolio through a single pane of the glass thereby enabling easier provisioning and management,” said IDC India Enterprise Networking Senior Market Analyst Sudharsan Raghunathan.
India Ethernet Switch Market Q2 2020
According to IDC’s Worldwide Quarterly Ethernet Switch Tracker, the Q2 2020 Ethernet Switch market in India stood at $120.8 million (by vendor revenue) registering a YoY decline of 13.8%.
A sudden drop in campus switch requirements reduced spending across major industry verticals. Supply chain issues were also aggravated due to the complete lockdown that happened during most part of the second quarter.
Key industry verticals that contributed to the Q2 switch market business were professional services, telecom, and banking. Except for a few budgeted government deals, most were deferred to later part of the year. Industries like manufacturing and education also saw a significant decline in switching investments.
Cisco continued to dominate the Ethernet Switch market with a 64.6% share during Q2 2020, followed by Hewlett Packard Enterprise (HPE) and Huawei.
India Router Market Q2 2020
According to IDC’s Worldwide Quarterly Router Tracker , the India Router market in Q2 2020 stood at USD 68.4 million (by vendor revenue) with a YoY decline of 5.5%.
Spending from telecom vendors continued to be steady to support the work from home bandwidth requirements. However, enterprise routing demand declined significantly by 15% YoY.
Banking and Professional services were the key enterprise verticals that contributed to the demand in the second quarter.
Cisco leads the router market with 65.8% market share in Q2 2020 followed by Nokia and Juniper.
India WLAN Market Q2 2020
According to IDC’s Worldwide Quarterly Wireless LAN Tracker , the Indian WLAN market had a YoY decline of 4.6% during Q2 2020.
The market stood at USD 54.1 million (by vendor revenue) majorly contributed by consumer gateway routers. While enterprise-class WLAN took a significant decline of 18.7% YoY, the consumer gateway router demand picked rapidly by 13.1% YoY to support the growing demand of employees and students working out of their homes.
Lower demand for campus infrastructure caused a steep decline in the enterprise WLAN segment.
The Ethernet Switch, Router, and WLAN market are expected to grow in single digits in terms of compound annual growth rate (CAGR) for 2018–2023. Increased adoption of emerging technologies such as cloud, IoT, mobility, etc. would drive incremental revenues. IDC also expects large investments for 5G rollouts in the next couple of years.
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