In its latest market analysis, The Insight Research Corp. predicted that US enterprises and consumers will spend more than $47 billion on carrier-provided Ethernet services during the next five years.
Virtually all major data service providers offer metro-area and wide-area Ethernet services. Insight Research expects industry revenue to increase from nearly $5 billion in 2012 to a shade past $11 billion come 2017.
At the same time, year-over-year spending growth will reportedly peter out. By 2017, the Carrier Ethernet market’s annual revenue growth rate will only be half of its current (2012) rate.
According to Insight Research, Ethernet has the capacity to meet growing bandwidth demands more cheaply and flexibly than rival services. This advantage remains the primary drive for its growth.
Another major factor that drove Ethernet’s growth in years past was the large-scale migration of wireless backhaul cell sites from the previous TDM standard to Ethernet, Insight Research expected the migration to continue contributing to Ethernet’s growth, but it also expects mobile backhaul growth to begin slowing down after the completion of LTE deployments.
“Wireless backhaul had been a major factor in this fast-growing telecommunications services sector,” stated Robert Rosenberg, president of Insight Research. “But with much of the conversion of TDM to Ethernet completed, we are forecasting that spending on Ethernet will moderate. Over the five year forecast period,” he added, “We project a compounded annual revenue growth rate of 17 percent, with growth slowing by 2016 to be more in the range of 12 to 15 percent.”
“Carriers and Ethernet Services: Public Ethernet in Metro & Wide Area Networks, 2012-2017” is a study released by The Insight Research Corp. It takes a look at Ethernet market spending and usage patterns by topology (E-line, E-LAN, and access), regional domain (metro, wide-area, and access), retail/wholesale, and various bandwidth levels.