Global Network Monitoring Switches Market Need for Secured Network and Growth in Gigabit Ethernet Speeds

Boost Market Growth

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November 2013

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Research Team

Olga Yashkova Program Manager

Measurement & Instrumentation

Sujan Sami Industry Manager

Measurement & Instrumentation

Lead Analyst Program Manager and Strategic Review

Committee Leader

Jeannette Garcia Corporate Communications

Measurement & Instrumentation

(001) 210.477.8427

Jeannette.Garcia@frost.com

For more information:

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Contents

Section

Executive Summary

Market Overview

Total Network Monitoring Switches Market

• External Challenges: Drivers and Restraints

• Forecasts and Trends

• Market Share and Competitive Analysis

• Mega Trends and Industry Convergence Implications

The Last Word (Conclusions and Implications)

Appendix

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Executive Summary

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Executive Summary

• In 2013, the global network monitoring switches market

generated $459.6 million in revenue.

• With big data and cloud services gaining importance,

companies need to have both technical and applied

skills to monitor and scrutinize large samples of data.

Network monitoring switches assist them in scrutinizing

the network data and in-turn analyze them.

Source: Frost & Sullivan.

2013 2020

Revenues 459.6 3,762.9

0

500

1000

1500

2000

2500

3000

3500

4000

(Re

ve

nu

es

$m

illi

on

)

Total Network Monitoring Switches

Market: Revenues, Global, 2013 and 2020

• The significant driver in the market today is to build intelligent switches and be able to

cater to higher bandwidth speeds going forward. One key trend in the market is to build

new architecture to hold several chassis for large number of ports.

• Vendors in the market are challenged to educate end users on the full features and

functionalities of monitoring switches. Another key challenge is to be able to monitor 100

gig speeds in the near future where there is no commercially available solution today.

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Executive Summary (continued)

• The key market participants include Gigamon, Ixia, VSS Monitoring, NetScout Systems,

Inc., Net Optics, Inc., APCON, Inc., Network Critical Solutions Limited, Arista Networks,

Inc., cPacket Networks, and Brocade among others.

• The enterprise end-user segment is expected to witness high growth rates due to

infrastructure developments in various regions of the world especially Asia-Pacific and

Latin American countries.

Source: Frost & Sullivan.

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Market Overview

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Market Definitions

• Network monitoring switches are network devices that direct traffic between two switches or between

two routers. They are also referred to as network packet brokers.

• They are classified into two categories—basic/matrix switches and intelligent switches. Basic

switches provide the connection between the two interfaces while intelligent switches, in addition to

providing the basic connection; also offer filtering, traffic shaping and other intelligent tasks that can

be performed.

• These intelligent switches provide the complete visibility into both physical and virtual networks. They

are used for securing the network and optimizing monitoring tool performance.

o The traffic can be manipulated for more efficient use of network security and performance tools,

both inline and passive. In addition, these switches deliver intelligent traffic conditioning features on

every port with sustained line rate performance, and ultra-low latency.

• The network monitoring switches market is also segmented into fixed and chassis from a product

standpoint. While the traditional switches are considered fixed; modular products are termed as

chassis products.

Source: Frost & Sullivan

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Market Definitions (continued)

The market is further analyzed from a geographic perspective in the following regions:

North America: Canada and the United States

Europe: Western, Central, Eastern Europe, and Russia

Asia-Pacific: Countries that are on the western border of the Pacific Ocean (including those on the Indo-

Chinese peninsula), the Pacific Islands, and Central Asia

Emerging Markets: Central and South America, the Caribbean islands, the Middle East, and Africa

The various end-user segments analyzed in this study include:

• Service Providers (SP)

• Enterprises

Source: Frost & Sullivan

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Key Questions This Study Will Answer

Is the market growing? How long will it continue to grow, and at what rate?

What are the key growth drivers and restraints for the market?

Who are the major participants in this market and what is their market share?

Which of the end-users groups represent most of the growth opportunities for the wireless test

market?

Are the products offered today meeting customer needs, or is there additional development

required?

Source: Frost & Sullivan

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External Challenges: Drivers and Restraints—

Total Market

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Drivers and Restraints

Total Network Monitoring Switches Market: Key Market Drivers and Restraints, Global, 2014–2020

End-user awareness hampers market growth

Need for interconnection between tools hinders

market growth

1-2 Years 3-4 Years 5-7 Years

Security services bolster market growth

Big data and cloud services increase sales of

network monitoring switches

Virtualization drives need for virtual devices

Application mobility trend boosts innovation

Tool optimization drives demand to serve customer

better

Evolution of 40 gig and 100 gig is the next

generation growth factor driving demand

Mark

et

Dri

vers

M

ark

et

Re

str

ain

ts

Impact: High Medium Low Source: Frost & Sullivan

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Competitive Environment

Total Network Monitoring Switches Market: Competitive Structure, Global, 2013

Number of Companies in the Market Approximately 10

Competitive Factors Diversified product portfolio, product differentiation, customer

satisfaction, time-to-market, optimized service levels

Key End-user Groups Enterprises and Service Providers

Major Market Participants Gigamon, Ixia; VSS Monitoring; NetScout Systems, Inc.; Net

Optics, Inc.; APCON, Inc.

Other Notable Market Participants Network Critical Solutions Limited; Arista Networks, Inc.;

Brocade

Source: Frost & Sullivan

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Legal Disclaimer

Frost & Sullivan takes no responsibility for any incorrect information supplied to us by

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Appendix

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Market Engineering Methodology

One of Frost & Sullivan’s core deliverables

is its Market Engineering studies. They

are based on our proprietary Market

Engineering Methodology. This approach,

developed across the 50 years of

experience assessing global markets,

applies engineering rigor to the often

nebulous art of market forecasting and

interpretation.

A detailed description of the methodology

can be found here.

Source: Frost & Sullivan research.

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Additional Sources of Information

• High Growth Opportunity: LTE Test Equipment Market

• Analysis of the IPv4 to IPv6 Transition Testing Market

• Chinese Ethernet Test Equipment Market

• Analysis of the Global Mobile Backhaul and Wireless Core Market

• Analysis of the Indian Wireless Test Equipment Market

• Global Triple Play and Next-generation Services Test and Monitoring Markets

• Cloud Infrastructure Testing and Cloud-based Application Monitoring Markets

• Global Video Test Equipment Markets

• World xDSL Test Equipment Market

• World Wireless Test Equipment Market

• Analysis of the Global Network Recording Market

• Analysis of Global Network Performance Management Market for Enterprises

• Global Network and Application Security Testing Market

Source: Frost & Sullivan research.

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Partial List of Companies Interviewed

• APCON, Inc.

• Arista Networks, Inc.

• Gigamon

• Ixia

• NetScout Systems, Inc.

• VSS Monitoring, Inc.

Source: Frost & Sullivan research.

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Learn More—Next Steps

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Source: Frost & Sullivan