Worldwide WLAN market saw robust growth of 9.4% in the second quarter of 2016 - IDC

15 Sep 2016

Enterprise WLAN Market Grew 9.4% Year over Year in Second Quarter of 2016

FRAMINGHAM, Mass., September 15, 2016 – The combined consumer and enterprise worldwide wireless local area network (WLAN) market segments increased 6.7% year over year in the second quarter of 2016 (2Q16), and increased 6.7% on a sequential basis. According to the results published in the International Data Corporation (IDC) W orldwide Quarterly WLAN Tracker, the enterprise segment grew 9.4% year over year in 2Q16, representing its strongest growth in over two years. The sustained growth observed so far in 2016 can be attributed to refresh cycles and the funding of digital transformation initiatives in many enterprises.

The 802.11ac standard has achieved market dominance and now accounts for 59.9% of dependent access point unit shipments and 77.4% 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.

Meanwhile, consumer WLAN market revenue saw growth for the first time since 2014, increasing 3.1% on a year-over-year basis in 2Q16. The adoption of the 802.11ac standard in the consumer market has been significantly slower than in the enterprise segment. In 2Q16, the 802.11ac standard accounted for just 22.6% of shipments and 51.3% of revenue in the consumer category.

"Recognizing the critical role that WLAN plays in IT's mobility and digital initiatives, enterprises are committing to WLAN upgrades and refreshes," said Nolan Greene, senior research analyst, Network Infrastructure at IDC. "Even as global economic indicators are mixed, IDC believes that enterprises will continue to invest in robust WLAN infrastructure in order to compete effectively in the digital economy."

From a geographic perspective, the enterprise WLAN market saw its strongest growth rates in Asia/Pacific (excluding Japan)(APeJ), which saw 14.6% year-over-year growth in 2Q16. Growth leaders in APeJ included Vietnam (up 79.4% year over year) and Korea (up 48.3%). Western Europe saw a healthy 13.6% increase year over year in 2Q16 after a tepid 1Q16. Growth leaders in this region are Spain (up 46.7%) and Sweden (up 40.5%). Central and Eastern Europe returned to growth in 2Q16, increasing 11.0% year over year. Croatia (up 44.2% year over year) and Romania (up 39.9%) finished as the region's pacesetters. Growing below the market rate in 2Q16 were North America, which recorded 7.3% year-over-year growth in 2Q16, Latin America which increased by 6.8% in the same period, and Middle East and Africa (MEA), rising 1.5% over 2Q15. Standouts in the latter two regions included Colombia (up 132.0% year over year) and Israel (up 54.6%), respectively. Japan recorded a year-over-year decline in 2Q16, contracting 2.4%.

"EMEA experiencing robust growth across key countries and APeJ continuing to perform well in 2Q16 helped lift the overall market to its best growth in some time," said Petr Jirovsky, research manager, Worldwide Networking Trackers. "Nearly unilateral growth across regional markets speaks to the mission-criticality of WLAN for strategic initiatives in the enterprise."

Key Enterprise WLAN Vendor Updates:

• Cisco 's 2Q16 worldwide enterprise WLAN revenue increased 1.1% year over year in 2Q16. Cisco's worldwide market share came in at 43.7% in 2Q16, down from the 45.2% seen in 1Q16, and down from 47.3% in 2Q15. IDC believes that the Meraki cloud-managed WLAN portfolio remains one of the primary growth drivers for Cisco.
• Aruba-HPE (excluding its OEM business and from 2Q16 also the H3C business) declined 6.1% in 2Q16 on a year over year basis, mainly due to exclusion of the spun out H3C business in China. Aruba-HPE's market share stands at 14.6% in 2Q16, down from 15.8% in 1Q16 and 17.1% in 2Q15.
• Brocade-Ruckus , in its first full quarter reporting as a combined entity, grew 7.9% year over year in 2Q16. Brocade-Ruckus accounted for 6.8% of the overall market in 2Q16, down from 7.7% in 1Q16 and 6.9% in 2Q15.
• Ubiquiti experienced exceptionally strong growth in 2Q16, increasing 95.3% year over year. Ubiquiti accounted for 4.2% of the overall market in 2Q16, down from 4.3% in 1Q16 and up from 2.4% in 2Q15.
• Aerohive also experienced noteworthy growth, increasing 34.1% year over year in 2Q16. In 2Q16, Aerohive held 2.7% of the market compared to 2.3% in 1Q16.

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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 eight 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.