SOHO and Residential Routers: Worldwide Market Share and Forecast, (Executive Summary) Executive Summary
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1 SOHO and Residential Routers: Worldwide Market Share and Forecast, (Executive Summary) Executive Summary Publication Date: 23 May 2003
2 Authors Rachna Ahlawat Gauri Pavate This document has been published to the following Marketplace codes: TELC-WW-EX-0596 For More Information... In North America and Latin America: In Europe, the Middle East and Africa: In Asia/Pacific: In Japan: Worldwide via gartner.com: Entire contents 2003 Gartner, Inc. and/or its Affiliates. All Rights Reserved. Reproduction of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The reader assumes sole responsibility for the selection of these materials to achieve its intended results. The opinions expressed herein are subject to change without notice
3 SOHO and Residential Routers: Worldwide Market Share and Forecast, (Executive Summary) Overview Gartner Dataquest provides data on the worldwide market for small office/ home office (SOHO) and residential routers for 2002 and a forecast for the next five years (2003 through 2007). It includes Integrated Services Digital Network (ISDN) and low-speed serial interface routers, DSL routers, cable routers and 2-port Ethernet routers (also known as broadband sharing routers). Market size and share (except for cable router) are included in terms of unit shipments and manufacturer revenue and average end-user purchase price for 2002 and the forecast for 2003 through port Ethernet router category statistics are broken up by wired and wireless. Results by Product Category The worldwide SOHO and residential router market exhibited the following characteristics in 2002: In 2002, 13 million units were sold worldwide, amounting to $1.5 billion in vendor revenue. The fastest-growing segment, 2-port Ethernet routers, accounted for 50 percent of all unit shipments. ISDN and low-speed serial interface router shipments decreased by 18 percent and DSL router shipments increased by over 90 percent. Cable routers started shipping toward the end of 2002 and 2-port Ethernet routers gained a lot of market traction. Their shipments increased by 115 percent in 2002 over Figure 1 illustrates the SOHO and residential router market broken up by segments in terms of unit shipments. Figure 2 shows the SOHO and residential router market vendor revenue for Figure 1 SOHO and Residential Router Market Unit Shipments, 2002 ISDN and Low-Speed Serial Interface Routers (10%) 2-Port Ethernet Routers (47%) DSL Routers (43%) Source: Gartner Dataquest (May 2003) 2003 Gartner, Inc. and/or its Affiliates. All Rights Reserved. 1
4 2 SOHO and Residential Routers: Worldwide Market Share and Forecast, (Executive Summary) Figure 2 SOHO and Residential Router Market Vendor Revenue, 2002 ISDN and Low-Speed Serial Interface Routers (19%) DSL Routers (43%) 2-Port Ethernet Routers (38%) Source: Gartner Dataquest (May 2003) Gartner Dataquest forecasts SOHO and residential router shipments to grow at 10 percent annually for the next five years, while vendor revenue from these products is expected to remain flat. Competition from DSL and elevated ISDN component costs are limiting the demand for ISDN routers. DSL lines in service are expected to grow robustly for the next few years. Business DSL customers will continue to be an important segment driving DSL router shipments. On the residential front, DSL service providers will increasingly offer home networking to residential customers with multiple PCs as part of a bundled package and managed home network services. Cable routers from several vendors are emerging from trials and volume shipments are expected to begin in the second half of In contrast to DSL routers, cable router shipments have been slow to emerge, as cable modem subscribers are mainly residential users rather than business users. However, as multiple PC households increase and home networking technologystandardsemerge(forexample,thecablehomeinitiativefrom CableLabs), cable router shipments are expected to increase as well. Introduction and proliferation of high-bandwidth gaming and other applications in the home market is spurring the growth of 2-port Ethernet routers that are used in conjunction with the already-existing cable or DSL modems. These products are also gaining traction as consumers are adopting wireless home networking solutions Gartner, Inc. and/or its Affiliates. All Rights Reserved. 23 May 2003
5 SOHO and Residential Routers: Worldwide Market Share and Forecast, (Executive Summary) 3 For the full report, see "Small Office/Home Office and Residential Routers: Worldwide Market Share and Forecast, ," TCEC-WW-MS Gartner, Inc. and/or its Affiliates. All Rights Reserved. 23 May 2003
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