Infonetics Research's latest work in the data center market shows that despite a 6 percent drop from the fourth quarter of 2011 to the first quarter of 2012, global revenue for data-center network equipment, including Ethernet switches, application delivery controllers and WAN optimization appliances, was strong year-over-year with a 17 percent growth rate.
Wide area network optimization appliances saw the steepest quarter-to-quarter revenue decline at 20 percent.
The Asia Pacific region posted the strongest sequential gain in the first quarter for overall data center network equipment revenue, but North America still accounts for nearly half the market. Renewed fears of an economic meltdown in the European Union are pressuring investments. EMEA was down 10 percent quarter-over-quarter and had the worst year-over-year showing of all regions.
As for the vendor market share, Cisco maintains a commanding lead in the overall data center network equipment market, followed by ADC, F5 and HP.
Sam Barnett, directing analyst for data center and cloud at Infonetics, said that for the remainder of 2012 and into 2013, he expects growth to be choppy as service providers and data center operators are at different stages in their data center upgrades and some are beginning to wind down their current investment cycle.
In the related storage area networking space, Barnett forecasted steady growth ahead for SAN switches and adapters, pushed by social networking, video sharing, data center innovations, and the eventual shift to cloud computing models.
"Fiber Channel continues to be the real star, with revenue from 16G Fiber Channel products growing at an astounding 52 percent compound annual growth rate from 2011 to 2016," Barnett said.
The global storage networking market remained steady at $1.3 billion in the first quarter. The economics in North America and EMEA put a layer of concern over the 70 percent of the market they command.
