New Dehli: India’s Enterprise networking market witnessed a significant 17.1% year-over-year (YoY) growth in terms of vendor revenues during 3Q21 (Jul-Sep) according to IDC India.
The Enterprise networking market includes ethernet switches, routers and WLAN segments. Switching business in India had a 13.5% YoY growth during 3Q21. Cisco continued to dominate the Ethernet Switch market with a 59.0% share during 3Q21, followed by Hewlett Packard Enterprise (HPE) and Juniper at 4.5% and 4.4%, respectively.
The router market expanded by an exceptional 45.4% YoY, while the sequential growth from last quarter was only 3.5%. Both the enterprise and service provider segments grew by 21.6% and 69.4% YoY, respectively. Cisco leads the router market with a 66.8% market share in 3Q21 followed by Nokia and Juniper at 15.2% and 10.8%, respectively.
WLAN segment declined marginally by 1.7% YoY (by vendor revenue). The demand dynamics are shifting between enterprise and consumer router segments as offices plan to open, the enterprise segment grew at 27.3% YoY, and consumer routers declined at 20.1% YoY.
With a market share of 28.7%, TP-Link was the market leader in the WLAN segment during 3Q21. Within the enterprise-class WLAN segment, Cisco was the market leader with a 22.9% market share, followed by HPE with 10.0%.
According to IDC’s Worldwide Quarterly Ethernet Switch Tracker, the 3Q21 Ethernet Switch market in India stood at $156.1 million (by vendor revenue), registering a strong YoY growth of 13.5%. The enterprise investment in non-DC switching grew at a 21.8% YoY owing to the trend of hybrid work and pent-up demand from the first half of the year starting to come through.
On the other hand, the DC switching segment grew at a marginal 3.8% YoY. Professional services, banking, telecommunications, and process manufacturing were the top verticals for 3Q 2021.
Overall the elevated YoY growth can be attributed to a weak base caused due to the COVID-19 pandemic the previous year and the country witnessing significant economic activity after the second wave of the pandemic. The pent-up demand from enterprises that stalled digital spending during the first half of 2021 started to revive infrastructure spending.
However, the vendor ecosystem faced challenges in terms of the semiconductor shortage, thereby exponentially increasing the shipping lead times. The prices for most network infrastructure components increased due to this shortage coupled with increasing logistics costs.
According to IDC India’s Enterprise Networking – Senior Market Analyst, Sudharsan Raghunathan, the impact of the semiconductor shortage on network infrastructure was significant this quarter.
“Vendors were struggling to meet the market demand, thereby expanding the lead times drastically. However, this also acted as an indirect catalyst in some cases where enterprises planned for their future needs in advance and placed orders to avoid unplanned delays,” said Raghunathan.
“The overall market encompassing all elements of networking bounced back strongly to pre-pandemic levels for the first time in six quarters anticipating 2022 to be a year of growth,” added Raghunathan.
Raghunathan pointed that the non-DC/campus market will act as the key factor determining the course of the market. But cautioned that a lot depends on the new variant of the virus and its impact on the Indian enterprises.