Worldwide enterprise WLAN market sees stronger growth in second quarter of 2017 as wireless digital transformation continues, according to IDC


Sep 17, 2017

FRAMINGHAM, Mass., September 15, 2017 – The combined consumer and enterprise worldwide wireless local area network (WLAN) market segments grew 2.5% year over year in the second quarter of 2017 (2Q17), finishing at $2.37 billion. According to results published in the International Data Corporation (IDC) W orldwide Quarterly WLAN Tracker, the enterprise segment grew 9.4% year over year in 2Q17 to reach $1.48 billion. In the enterprise segment, annualized growth in 2Q17 was comparable to that of 2Q16, when year-over-year growth also registered at 9.4%.

IDC believes that a steady stream of upgrades to the 802.11ac standard as part of the digital transformation (DX) of the enterprise contributed heavily to the 2Q17 growth. The 802.11ac standard now accounts for 84.5% of dependent access point unit shipments and 92.1% of dependent access point revenues, up from 70.9% and 84.7% in 1Q17. This significant sequential jump points to a continued trend of 802.11n obsolescence, which is expected to be nearly complete by the end of 2018.

Meanwhile, consumer WLAN market revenue decreased 7.2% on a year-over-year basis in 2Q17, finishing at $892.3 million. In 2Q17, the 802.11ac standard accounted for just 32.3% of shipments and 62.8% of revenue in the consumer category. 802.11ac was a bright spot in the consumer WLAN segment in 2Q17, with revenues increasing 13.6% year over year and shipments increasing 36.2% over the same period.

"The enterprise WLAN market's 2Q17 performance sends a strong message that this market is still in growth mode," said Nolan Greene, senior research analyst, Network Infrastructure at IDC. "WLAN is a critical enabler of end-to-end digital transformation strategies as wireless applications and devices continue to unlock new digital and business outcomes."

From a geographic perspective, the enterprise WLAN market saw its strongest 2Q17 growth coming from the Middle East and Africa (MEA), which increased 33.2% year over year in 2Q17, following a 1Q17 where the region experienced flatness. A 63.3% year-over-year upswing in the United Arab Emirates is the largest vector of this growth. Central and Eastern Europe (CEE) experienced strong growth for a second consecutive quarter, increasing 19.8% on an annualized basis in 2Q17.

Standout performers in the region include Hungary (up 66.9% year over year) and Russia (up 42.1%). Asia/Pacific (excluding Japan)(APeJ) saw another strong performance in 2Q17, increasing 17.6% year over year. While most APeJ countries saw growth in 2Q17, Singapore and Thailand were most noteworthy (up 177.9% and 71.1% year over year, respectively). Western Europe also delivered a robust performance, increasing 16.2% on a year-over-year basis in 2Q17, with Spain and Finland recording the highest country-level growth rates (up 46.2% and 34.8%, respectively).

Japan now has experienced four consecutive quarters of growth (up 15.5% in 2Q17), signaling a full turnaround of a multi-quarter decline trend that took place from 2014-2016. The Americas experienced more moderate growth in 2Q17. Latin America increased 1.3% on an annualized basis.

Argentina was a bright spot in the region, growing 47.6% year over year. North America was essentially flat, rising 0.3% year over year in 2Q17 with a 4.4% increase in Canada and essentially flat growth in the United States.

"A continued uptick in 802.11ac shipments as the de facto global standard for some time to come powered strong growth across most regions," said Petr Jirovsky, research manager, Worldwide Networking Trackers. "Aside from the ongoing DX trends, the market will also be shaped by ongoing refresh cycles and regional economics." Key Enterprise WLAN Vendor Updates:

Cisco's 2Q17 worldwide enterprise WLAN revenue increased 8.2% year over year in 2Q17. Cisco's worldwide market share came in at 43.2% in 2Q17, down from 43.4% in 1Q17, and 43.7% in 2Q16. IDC believes that the Meraki cloud-managed WLAN portfolio remains one of the primary growth drivers for Cisco, offsetting declines in its traditional controller-based WLAN portfolio. HPE-Aruba (excluding its OEM business and excluding H3C as of 2Q16) increased 28.8% year over year in 2Q17. HPE-Aruba's market share stands at 17.2% in 2Q17, up from 16.2% in 1Q17 and 14.6% in 2Q17.

Brocade-Ruckus declined 7.4% year over year in 2Q17, while growing 19.5% sequentially. Brocade-Ruckus accounted for 5.8% of the overall market in 2Q17, up from 5.7% in 1Q17 and down from 6.8% in 2Q16. Ubiquiti recorded another quarter of strong growth in 2Q17, increasing 37.1% year over year. Ubiquiti accounted for 5.3% of the overall market in 2Q17, down from 6.1% in 1Q17 and 4.2% in 2Q16. Huawei once again experienced very strong growth in 2Q17, increasing 111.6% over 2Q16, while claiming 4.5% market share, up from 2.3% in 2Q16.

The IDC Worldwide Quarterly WLAN Tracker provides total market size and vendors share data in an easy-to-use Excel Pivot Table format. The geographic coverage includes 8 major regions (USA, Canada, Latin America, AP excluding Japan, Japan, Western Europe, Central and Eastern Europe, Middle East and Africa) and 58 countries. The WLAN market is further segmented by product class, product type, product, standard, and location. Measurement for the WLAN market is provided in factory revenue, customer revenue, and unit shipments.

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