Report Overview

The router and switch infrastructure market are gaining momentum in China due to the convergence of business and residential networks, the growth of cloud computing, the popularity of internet-enabled devices, and a rising trend toward virtualization.

China Router and Switch Market- Industry Trends & Forecast Report 2027

China router and switch market is poised for a moderate growth. The market is growing at a CAGR of 3.9 % during the forecast period (2021-2027). Market drivers include the convergence of business and residential networks, the growth of cloud computing, the popularity of internet-enabled devices, and a rising trend toward virtualization. Moreover, the overwhelming use of Gigabit Ethernet is poised to revolutionize  the state of the industry. Furthermore, wireless backhaul is an emerging opportunity that will likely become a significant driving force in the router and switch infrastructure sector. The China router and switch market is also fueled by the increased desire of customers for high bandwidth.

China Router and Switch Market Overview

Router and switch are computer networking devices that allow one or multiple computers to be connected to other computers and networking devices. A router works by connecting two or multiple logical subnets, which do not necessarily map one-to-one to the router's physical interfaces. On the contrary, a network switch is networking hardware (likewise a router) that connects devices on a computer network by applying packet switching to receive and forward given data.

China Router and Switch Market Trend

Growth Drivers

Adoption of IoT Connectivity Systems

Network infrastructure adoption has accelerated the need for strong growth in the router and switch markets as industries and businesses need fast access to data and information. This has elevated the use of network infrastructure and is putting a constant strain on the same. Additional improvements are taking place with the aid of networking solutions like routers and switches. Since then, the IoT has become increasingly popular among various industries (both related to and unrelated to e-commerce). Therefore the inclusion of router and switch infrastructure has supported the requirement of high-speed internet/ connectivity access.

Restraints

High cost may Hamper the Growth of the Market

The network router and switch are highly expensive, which may hinder the growth of the market. The 10 Gigabit Ethernet comes with remarkable speeds. At 10 billion bits per second, the user can efficiently handle any high-powered network equipment. Most enterprises that run extensive data over servers are embracing 10GbE due to its efficiency. 10GbE comes at a very high cost. For instance, Force10 offers its two-port 10GBE card for USD 34,000 - USD 17,000 per port. The company provides E1200, which can support up to 28 ports of 10GBE in a 14-slot framework. Besides, it also needs a high-end computer and quality cabling as a supportive ecosystem to the internet. Otherwise, the user might face bottlenecks alongside unreliable internet speeds.

Impact of COVID-19

COVID-19 started from Wuhan, China, in December 2019 and has quickly expanded worldwide since then. The COVID-19 has had a detrimental influence on economies and enterprises in several nations due to lockdowns, travel bans, and commercial shutdowns. The closure of numerous plants and companies has had a severe influence on supply chains and manufacturing, delivery schedules, and product sales, in contrast with the COVID-19 situation, the electrical and allied industries, such as semiconductors, consumer electronics, and data centers and communications infrastructure is witnessing uptick. Increasing dependence on the internet can be attributed to the rise of the work from home model. Moreover, the sector is expected to be more robust due to the ongoing strategic investments to support increased network traffic and data usage for remote or distant access work during the lockdown period.

China Router and Switch Market: By Service

Based on services, the China router and switch market is segmented into BRAS, ethernet aggregation, ethernet access, internet data center/collocation/ hosting, and others. Among these, the internet data center/collocation/hosting segment is likely to witness the highest CAGR during the forecast period. The Internet data center/collocation/hosting is used to house computer systems, coupled with associated storage and telecommunication systems. It includes excessive data communication, environmental controls, backup power supplies, and various security devices. A collocation center is a data center service where bandwidth, space, and equipment are available for rent for retail customers.

The collocation center provides higher bandwidth and low network latency at a low-cost cost. Collocation customers are primarily Web, e-commerce, and telecommunication companies, with major enterprises using the facility for disaster prevention and offshore data backup.

Source: BlueWeave Consulting

China Router and Switch Market: By End-Use Industry

Based on the end-use industry, the China router and switch market is segmented as travel and transport, communication and technology, energy and power, military and defense, manufacturing, healthcare, and others. Among these, the healthcare industry is likely to witness the fastest growth rate during the forecast period. A significant increase in COVID-19 cases has created new challenges for healthcare organizations in scaling up testing and care services while minimizing risks to non-critical patients and healthcare workers. Increasing use of remote workers, telemedicine, triage tents in the field, and connected gadgets required healthcare IT personnel to shift overnight to the digital realm. Many internet & technology companies started offering clinical-grade Wi-Fi systems. For instance, the AP510C/CX from Extreme is a high-performance, enterprise-class Wi-Fi 6 access point suitable for various industries, including retail, education, hospitality, and healthcare. These businesses must support a large number of users and IoT devices while also providing an excellent user experience.

Competitive Landscape

The China router and switch market is highly fragmented due to the presence of numerous domestic and international players. Besides this, the emergence of new entrants has resulted in healthier competition among long-established service providers in the industry. Some key players in the China router and switch market are Lucent, Avici Systems, Cisco Systems, Inc., ECI Telecom, Ericsson, Extreme Networks, Actelis Networks, ADTRAN Inc, ADVA Optical Networking SE, Force, Networks, ZTE Corporation, RAD Data Communication Networks, Hatteras Networks, Inc., MRV Communications Inc., Telco Systems, Huawei Technologies Co. Ltd., Juniper Networks, Tellabs Inc., among various others.

Recent Developments

• In September 2021, Huawei unveiled four cutting-edge optical infrastructure devices that are expected to speed up digital transformation in industries like electric power, oil and gas, coal mining, and manufacturing. Huawei has developed the industry's first Optical Transport Network (OTN) communication product, hybrid OTN (H-OTN), using industry-leading optical technologies to support Native Hard Pipes (NHPs). Huawei also unveiled a new range of Huawei OptiXsense optical terminals, including a 10G compact optical terminal and an innovative intrinsically safe industrial optical terminal.

• In April 2021, Juniper Networks, a leader in secure, AI-driven networks, announced that 21Vianet had deployed Juniper Networks MX Series Universal Routing Platforms with segment routing traffic engineering (SR-TE) protocols to help meet rising data traffic demands and support its customers' ever-growing digital transformation needs. The 21 Vianet is a leading carrier-neutral data center service provider in China.

Scope of the Report

• By Product
  • • • Internet Exchange Router
      • Service Provider Core Router
      • Multiservice Edge Router
      • Ethernet Service Edge Router
      • ATM switch
• By Service
  • • • BRAS
      • Ethernet Aggregation
      • Ethernet Access
      • Internet Data Center/Collocation/ Hosting
      • Others
•  By End-Use Industry
  • • • Travel and Transport
      • Communication and Technology
      • Energy and Power
      • Military and Defense
      • Manufacturing
      • Healthcare
      • Others