07 Mar 2016

Enterprise WLAN Market Grew 5.9% Year over Year in Q4 2015, and 3.7% for the full year 2015

FRAMINGHAM, Mass., March 7, 2016 – The combined consumer and enterprise worldwide wireless local area network (WLAN) market increased 1.4% year over year in the fourth quarter of 2015 (4Q15), while declining -0.3% for the full year 2015. According to the results published in the International Data Corporation ( IDC ) Worldwide Quarterly WLAN Tracker , the enterprise segment grew 5.9% year over year in 4Q15, experiencing its best growth quarter of the year, an improvement from the sub-5% growth of the previous three quarters. While 4Q15 represented an improvement, the market grew at a tepid 3.7% for the full year, less than half of what the market experienced in 2014. The current deceleration of the annual growth rate, as compared to previous years, is largely due to the confluence of two factors: a hold on new WLAN projects due to the uncertain short-term trajectory of the global economy and market anticipation of the full availability of Wave 2 802.11ac products.

The 802.11ac standard continues on its brisk adoption path and now accounts for 54.5% of dependent access point unit shipments and 71.3% of dependent access point revenues, representing a noticeably faster adoption rate from 802.11n than what we saw with the 802.11a/b/g to 802.11n transition several years ago. For the full year 2015, 802.11ac accounted for 51.0% of dependent access point shipments and 66.1% of dependent access point revenues. Increased demand on enterprise WLANs will continue to be a driving factor in this transition, especially as enterprise mobility use cases proliferate and IoT applications move into the mainstream.

Meanwhile, consumer WLAN market revenue declined -3.9% on a year-over-year basis in 4Q15 and by -4.8% for the full year 2015. The adoption of the 802.11ac standard in the consumer market has been significantly slower than in the enterprise segment. In 4Q15, the 802.11ac standard accounted for just 19.3% of shipments and 42.1% of revenue in the consumer category.

"While weaker compared to what was seen prior to 2015, the growth experienced in 4Q15 was higher than that of the previous three quarters," said Nolan Greene , Research Analyst, Network Infrastructure at IDC. "Expected fourth quarter refresh cycles were certainly at play here across the world, with organizations preparing for greater digital transformation initiatives in 2016."

From a geographic perspective, the enterprise WLAN market once again saw its strongest growth rates in Asia/Pacific (excluding Japan)(APeJ), which saw 14.8% year-over-year growth in 4Q15 and 11.3% for the full year 2015. Within the APeJ region, China increased 41.4% in 4Q15 and 16.5% for the full year 2015. India also showed strong growth with a 41.9% jump in 4Q15 and 39.3% increase for the full year 2015. The Europe, Middle East, and Africa (EMEA) region saw a healthy 10.7% increase year over year in 4Q15 after a tepid 3Q15. This strong performance helped propel EMEA to a 5.1% growth rate for the full year 2015. Spain, United Arab Emirates, and Netherland all saw growth in excess of 30% year over year in 4Q15. Latin America reversed its declines from 3Q15, growing 0.2% year over year in 4Q15. For the full year 2015, Latin America increased 7.8%. North America was essentially flat on a quarterly and full year basis, growing 0.2% year over year in 4Q15 and 0.4% for the full year.

"Due to differing market forces on the local levels, regional performance in enterprise WLAN varied significantly in 2015, especially in the fourth quarter," said Petr Jirovsky , Research Manager, Worldwide Networking Trackers. "APeJ continues to see good growth for digital initiatives, whereas the EMEA market felt a surge of confidence in 4Q15. North America was surprisingly flat, with E-Rate uplift not able to fully offset economic uneasiness."

Key Enterprise WLAN Vendor Updates:

• Cisco's 4Q15 worldwide enterprise WLAN revenue declined -0.7% year over year in 4Q15, and grew 2.0% for the full 2015. Cisco's worldwide market share came in at 45.0% in 4Q15, down from the 48.1% seen in 4Q14, and from 48.0% in 3Q15. For the full year 2015, Cisco's market share came in at 47.0%, down from 47.8% in 2014. IDC believes that the Meraki cloud-managed WLAN portfolio remains one of the primary growth drivers for Cisco.
• Aruba-HP Enterprise (combining HP Enterprise and Aruba but excluding its OEM business) performed just below the overall market in 4Q15 and grew 5.5% year over year and 8.6% for the full year 2015. Aruba-HPE's market share stands at 15.9% in 4Q15, down from 17.4% in 3Q15. For the full year 2015, Aruba-HPE recorded 16.9% market share, compared to 16.2% in 2014.
• Ruckus had another strong quarter in 4Q15, once again growing 16% year over year (although only up 0.5% quarter over quarter). For the full year 2015, Ruckus outperformed the market, growing 13.1% over 2014. Ruckus accounted for 6.7% of the overall market in 4Q15, up from 6.1% in 4Q14. For the full 2015, Ruckus' market share came in at 6.9%, compared to 6.3% in 2014.
• Aerohive grew 26.7% year over year in 4Q15 and 11.0% quarter over quarter, once again benefitting from its relatively strong position in the K-12 education vertical, which resulted in increased business from E-Rate spending in United States. For the full year 2015, Aerohive grew 4.2% over 2014, and finished with 2.1% market share.

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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.