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Service Provider Switch And Router Revenue To Hit $8.9 Billion By 2008

Worldwide service provider router and switch revenue hit $1.8 billion in 2005 and will reach $8.9 billion by 2008, according to a new report by Infonetics Research.

Annual revenue has increased 10% over the first quarter and 24% year over year. All equipment categories grew, but IP router sales increased the most. Cisco leads the IP router sales with 56%, with Juniper second with 21%. Huawi doubled its sales from last year to reach third place with 9%.

Overall, the IP router edge revenue totaled $820.6 million, a 13% sequential and 31% annual increase. The report also found that standard IP edge applications make up the lion's share of IP edge router revenue with 57%, and BRAS applications make up 29% of IP edge router revenue. Multiservice convergence revenue grew to $110.7 million, making up 14% of IP edge router revenue.

Kevin Mitchell, a principal analyst at Infonetics Research, said in a statement, "IP edge routers will play a huge role in the drive for data network convergence, in many cases acting as the gateway to the MPLS core for layer 2 data access connections." According to Mitchell, this requirement for new generation routers will drive growth rates of IP edge routers to between 12% and 20%, and the multiservice convergence application will be the fastest growing category.