“By comparison, the non-GenAI Datacenter Ethernet switch market will grow at a low single digit CAGR from 2023-2028. But the broader Datacenter Ethernet Switch market is a diverse market: On-prem traditional DC deployments will be declining, enterprise private clouds will grow moderately, and public cloud deployments (outside of GenAI) will continue to show solid growth,” Butler said.
SD-WAN impacting enterprise router market
Meanwhile, the enterprise router market is in a state of transition, as it is being subsumed to some degree into SD-WAN with its software and cloud-based deployments, according to Butler.
“While the enterprise router market will decline over the five-year forecast period, the SD-WAN market is set to grow by a more than 9% CAGR to reach $8.1 billion by 2028,” Butler said.
Different trends are impacting the service provider (SP) routing market, Butler noted. “SP routing is down quite a bit this year because of weak spending by [communications service providers] in general that is impacting many different SP networking markets, including the SP Routing. We expect the market to remain weak for another quarter or two and then rebound in 2025,” Butler said.
