- Summary
- Table Of Content
- Methodology
Ethernet Switch Market Introduction :
Ethernet Switch Market is estimated to reach over USD 25,477.18 Million by 2030 from a value of USD 17,924.68 Million in 2022, growing at a CAGR of 4.7% from 2023 to 2030.
Ethernet Switch Market Definition & Overview:
An Ethernet switch is a networking device that facilitates the interconnection of multiple devices within a local area network (LAN). The switch operates at the data link layer of the Open Systems Interconnection (OSI) model, enabling the efficient transfer of data between connected devices. Additionally, the switch uses the destination MAC address to determine the appropriate port to forward the data, allowing for simultaneous communication between multiple devices connected to different ports. Moreover, an Ethernet switch enhances network performance and improves data transfer speeds by providing increased bandwidth and reducing collisions.
Ethernet Switch Market Insights :
Ethernet Switch Market Dynamics - (DRO) :
Key Drivers :
Increasing demand of Ethernet switches to provide high-speed connectivity to data centers is propelling the market growth
Data centers are crucial for storing, processing, and managing large volumes of data, and require robust networking infrastructure to ensure efficient data transmission and connectivity. Ethernet switches play a vital role in data center networks by providing high-speed, low-latency, and reliable connections between servers, storage systems, and other network devices. Additionally, the growth of data-intensive applications including cloud computing, big data analytics, artificial intelligence, and Internet of Things (IoT) is leading to a significant increase in data center traffic. The surge in data traffic requires data centers to scale up the networking capabilities to handle the growing demands. Ethernet switches offer scalability, flexibility, and high performance, and thus are increasingly adopted in data centers. For instance, in April 2023, Edgecore Networks Corporation launched DCS520, an ultra-high capacity 400G Ethernet switch to meet the growing demands of next-generation data centers. The advanced Ethernet switch is designed to provide flexibility, low-latency, and high-efficiency data processing to cloud operators along with offering 25.6 Tbps switching capacity, hence contributing notably in driving the market growth.
Increasing number of small-medium enterprises is raising the demand of Ethernet switches for establishing local area networks (LANs) within SME environments
SMEs require reliable and efficient network infrastructure to support day-to-day operations. Ethernet switches provide a cost-effective solution for establishing local area networks (LANs) within SME environments. The switches enable SMEs to connect computers, servers, printers, and other network devices, allowing for seamless communication, data sharing, and resource utilization. Additionally, SMEs rely heavily on internet connectivity to conduct various operations. Ethernet switches enable the establishment of reliable and high-speed internet connections within the work environment.
Moreover, with the growing reliance on cloud-based applications, online services, and remote working, SMEs require Ethernet switches to ensure a stable and faster internet connection for the employees. In conclusion, the growing number of small-medium enterprises is fueling the growth of the Ethernet switch market to provide high-speed data connectivity at an affordable price. For instance, in December 2022, according to a report by The House of Commons Library, 99% of businesses in the United Kingdom are small or medium-sized businesses and SMEs accounted for 61% of the United Kingdom's economy. Additionally, the UK has approximately 217,000 small businesses and 36,000 medium-sized enterprises, thus contributing significantly in driving the market growth.
Key Restraints :
High manufacturing and maintenance cost of Ethernet switch is hindering the market growth
The cost of production of Ethernet switches is significantly high which compels the users to seek lower-quality switches that are available at cheap prices. The components utilized in Ethernet switches include Application-Specific Integrated Circuits, Dynamic RAM (DRAM), and Static RAM (SRAM) are expensive to manufacture. In addition, Ethernet switches require regular maintenance and support, including troubleshooting, firmware updates, and potential repairs. The high maintenance costs associated with switches are a deterrent for organizations, restraining market growth. Moreover, the cost of replacement and repair of the Ethernet switch is also high, leading to additional upfront costs, thus negatively impacting the growth of the global Ethernet switch market.
Short lifecycle of the built-in fans in Ethernet switches is restraining the market growth
In an Ethernet switch, one mechanical component that wears out easily and has a short lifecycle is the fan. Ethernet switches contain built-in fans to dissipate heat generated by the switch's components and help to prevent overheating. The fans in an Ethernet switch operate continuously to maintain airflow and keep the internal temperature within acceptable limits. Over time, the constant rotation and exposure to dust and debris cause the fan's bearings to wear out resulting in reduced speed and generation of undesirable sound. Consequently, the inefficient functioning of the fan leads to thermal issues, damaging other components of the switch, thus impeding the growth of the global Ethernet switch market.
Future Opportunities :
Expanding 5G network infrastructure is creating potential opportunities for the growth of the Ethernet switch market
5G networks are designed to deliver higher data speeds and lower latency compared to previous generations. The increased performance raises higher demands on the network infrastructure, including Ethernet switches, to handle the higher bandwidth requirements. Ethernet switches play a crucial role in providing the required connectivity and throughput for 5G networks, hence becoming an essential component of the infrastructure. In addition, 5G networks rely on a dense network of small cell power amplifier and base stations to provide widespread coverage and support the massive number of connected devices. Each small cell and base station require backhaul connections to the core network that are facilitated by Ethernet switches. The deployment of 5G networks, especially in urban areas is driving the demand for Ethernet switches to support network densification and ensure reliable and high-speed connectivity. Subsequently, the expanding 5G network infrastructure is creating potential opportunities for the growth of the Ethernet switch market to provide the required connectivity.
Ethernet Switch Market Report Insights :
| Report Attributes | Report Details |
| Study Timeline | 2017-2030 |
| Market Size in 2030 | USD 25,477.18 Million |
| CAGR (2023-2030) | 4.7% |
| By Type | Modular Ethernet Switches and Fixed Configuration Ethernet Switches |
| By Capacity | 100 Megabyte, 1 Gigabyte, 10 Gigabyte, 40 Gigabyte, and 100 Gigabyte |
| By End-User | Consumer Electronics, Healthcare, IT & Telecom, Transportation, Automotive, and Others |
| By Region | North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa |
| Key Players | Advantech Co., Ltd., NXP Semiconductors N.V., Alcatel-Lucent, Allied Telesis, Brocade Communications Systems, Inc., Cisco Systems Inc., Dell Technologies, D-Link Corporation, Eaton Corporation, Hewlett-Pack Corporation, Honeywell International, Huawei Technologies, Siemens SE |
Ethernet Switch Market Segmental Analysis :
Based on the Type :
The type segment is bifurcated into modular Ethernet switches and fixed configuration Ethernet switches. The fixed configuration Ethernet switches accounted for the largest market share in 2022 and are also projected to witness the fastest CAGR during the forecast period. Fixed configuration Ethernet switches comprise unmanaged switches, smart switches, managed L2 switches, managed L3 switches, divided switches, and modular switches. Unmanaged Ethernet switch holds the largest market share as the switches are incredibly easy to use and require no configuration and management. Additionally, unmanaged switches are plug-and-play devices, allowing users to simply connect the devices and immediately start using the network. Moreover, unmanaged Ethernet switches are more cost-effective in comparison to other fixed configuration Ethernet switches, further driving market growth. Further, the switches have the ability to withstand harsh environmental conditions and are manufactured using corrosion-resistant material, thus contributing considerably in boosting the growth of the unmanaged Ethernet switch segment. For instance, in April 2022, Versitron Inc. launched unmanaged industrial switches with 100/1G SFP slots and 10/100/1000 RJ45 ports. The switches are designed for basic plug-and-play installations and are corrosion-resistant to withstand harsh environmental conditions.
Based on the Capacity :
The capacity segment is categorized into 100 megabytes, 1 gigabyte, 10 gigabytes, 40 gigabytes, and 100 gigabytes. 1 gigabyte Ethernet switches accounted for the largest market share in 2022 as the switches offer a good balance between speed, cost, and compatibility with existing infrastructure. In addition, many devices, namely computers, servers, and network equipment, are equipped with 1 Gigabit Ethernet port, further driving the dominance of the 1 gbps segment. Moreover, 1 Gigabit Ethernet switches are extensively adopted in various network environments, including homes, offices, schools, and small to medium-sized businesses. Furthermore, 1 Gigabit Ethernet connection provides ample bandwidth to handle network activities, including internet browsing, file sharing, video streaming, and VoIP services. Consequently, the aforementioned factors including sufficient bandwidth, cost-effectiveness, and compatibility with existing infrastructure are contributing significantly in bolstering the growth of 1 gigabyte segment.
100 gigabyte Ethernet switches are anticipated to witness the fastest CAGR during the forecast period. The growth of the market is credited to the increasing adoption of 100 gbps Ethernet switches in industrial and commercial applications namely cloud services, edge computing, and big data. In addition, data centers serve as the backbone of modern digital infrastructure, requiring high-speed and scalable networking solutions. 100 Gigabyte Ethernet switches offer the necessary throughput to connect servers, storage systems, and other networking equipment within the data center, enabling efficient data transfer and supporting the growing demands of data-intensive applications. For instance, in January 2021, Infinite Electronics International, Inc. brand L-com launched WM8-4G-4GP+ and DT10-2G-8GP+, two industrial 100/1000 gigabyte switches with eight ports and ten ports respectively. The advanced switches are introduced to fulfill various commercial and industrial applications by providing required servers and storage systems, hence contributing notably in spurring the market growth.
Based on the End-User :
The end-user segment is classified into consumer electronics, healthcare, IT & telecom, transportation, automotive, and others. IT & telecom accounted for the largest market share of 35.4% in 2022 as Ethernet switches are the primary components to build passive optical LANs in IT and telecom environments. The switches provide connectivity and facilitate data transmission among computers, servers, printers, and other network devices within a local area network. Additionally, Ethernet switches also allow efficient and reliable communication within the LAN, enabling users to share resources and access network services. Consequently, the expanding IT industry is raising the demand for Ethernet switches for the development of LANs to provide seamless data transmission. For instance, in February 2023, according to India Brand Equity Foundation (IBEF), the IT sector accounted to 7.4% of India's GDP in FY22 and is expected to reach 10% by 2025. The expansion in the IT sector, thus contributes remarkably in driving the growth of the Ethernet switch market.
Consumer electronics segment is predicted to register the fastest CAGR in the Ethernet switch market during the forecast period. Ethernet switches play a vital role in creating home networks, enabling multiple devices to connect to the internet and communicate with each other. In addition, the switches facilitate wired connections between devices including computers, gaming consoles, smart TVs, streaming devices, and network-attached storage (NAS) devices. Ethernet switches provide the necessary ports to connect the devices and establish a reliable and high-speed wired network within the home, thus contributing significantly in driving the growth of the consumer electronics segment.
Based on the Region :
The regional segment includes North America, Europe, Asia Pacific, Middle East and Africa, and Latin America.
North America accounted for the largest market share of 186.92 million in 2022 and is expected to reach 320.81 million in 2030 as the region invests heavily in developing robust network infrastructure, including both wired and wireless networks. In addition, in the region, the U.S. accounted for the maximum revenue share of 55.45% in the year 2022. Additionally, the region's advanced telecommunications infrastructure, including high-speed broadband networks, extensive fiber-optic connectivity, and 5G cellular networks, provides a solid foundation for the deployment and adoption of telecom equipment. Moreover, North America boasts robust research and development capabilities in the telecom sector along with the presence of top-tier universities, research institutions, and technology hubs encourages innovation and collaboration among academia, industry, and government organizations. Furthermore, the increasing investments by the government to develop advanced communication technologies are also contributing in driving the market growth. For instance, in April 2021, the Department of Defense in partnership with The National Science Foundation invested USD 40 million for the expansion of cellular, Wi-Fi, and satellite networks to connect billions of Americans across the United States.
Asia Pacific is expected to register the fastest CAGR of 7.5% during the forecast period in the Ethernet Switch Market. Asia Pacific is at the forefront of mobile connectivity, with high smartphone penetration and data usage. The region has also been actively rolling out 5G networks, with countries including China, South Korea, and Japan leading the way. In addition, the deployment of 5G technology requires significant investments in telecom equipment, contributing to the growth of the market in the region. Moreover, the growth of e-commerce and digital services in the Asia Pacific is driving the need for robust telecom infrastructure and equipment. The popularity of online shopping, digital payments, and on-demand services is increasing the demand for high-speed connectivity, data centers, and cloud infrastructure, further driving the adoption of telecom equipment. Consequently, the expanding digital infrastructure and rising e-commerce sector are the key factors responsible for accelerating market growth.
Top Key Players & Market Share Insights :
The Ethernet Switch Market features a competitive landscape with several major players vying for market share. The market is dynamic, and the competitive landscape may have evolved with emerging players and evolving partnerships or collaborations. Key players are:-
- Carritech Limited
- Extreme Networks, Inc.
- Qualcomm TechCompany, Inc.
- Telefonaktiebolaget LM Ericsson
- ZTE Corporation
- Ribbon Communications Operating Company, Inc.
- FiberHome Technologies
- Fujitsu Limited
- Huawei Technologies Co. Ltd
- Juniper Networks, Inc.
- Rakuten Mobile, Inc.
- NEC Corporation
- Nokia Corporation
Recent Industry Developments :
- In July 2023, Rakuten Mobile, Inc. launched a research and development project for the development of advanced Open RAN integration infrastructure for Post-5G Information and Communication Systems.
- In June 2022, Nokia Corporation and Proximus collaborated together to successfully enhance the performance of 5G network slicing using advanced radio software-defined telecom networking equipment.
Key Questions Answered in the Report
What is an Ethernet switch? +
An Ethernet switch is a networking device that facilitates the interconnection of multiple devices within a local area network (LAN). The switch operates at the data link layer of the OSI model, enabling the efficient transfer of data between connected devices.
What specific segmentation details are covered in the Ethernet switch market report, and how is the dominating segment impacting the market growth? +
1 gigabyte Ethernet switches dominates the market as the switches offer a good balance between speed, cost, and compatibility with existing infrastructure. In addition, many devices namely computers, servers, and network equipment, are equipped with 1 Gigabit Ethernet port, further driving the dominance of the 1 gbps segment.
What specific segmentation details are covered in the Ethernet switch market report, and how is the fastest segment anticipated to impact the market growth? +
Consumer electronics will register the fastest CAGR as Ethernet switches play a vital role in creating home networks, enabling multiple devices to connect to the internet and communicate with each other.
Which region is anticipated to witness the highest CAGR during the forecast period, 2023-2030? +
Asia Pacific is anticipated to witness the fastest CAGR during the forecast period due to the rapid industrialization, infrastructure development and increasing investment by the government.
