Heavy Reading
Length: 40 Pages
Price: $3,995
Click here for a full list of included vendors
41 pages of analysis covering growth prospects for US retail Ethernet services
Deep exploration of drivers for Ethernet adoption and criteria for deciding between alternative services and technologies
In-depth analysis of the patterns of Ethernet adoption and applications in five major vertical markets: financial, healthcare, education, government, and media/entertainment
Five-year market forecasts for all key Ethernet verticals, with detailed breakdowns by regional domain, service topology, and bandwidth level

Length: 40 Pages
Price: $3,995
Analyst at Large,
Heavy Reading
Koppman has covered the North American carrier industry for 20 years as an analyst, focusing on market forecasting and analysis, issues of industry structure...
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U.S. Ethernet Vertical Markets: A Five-Year Market Forecast

Retail Ethernet service in the US has historically been dominated by several key "vertical markets" or sectors, which started with local governments and school districts in the 1990s adopting native/transparent LAN services provided by ILECs. With accelerating bandwidth demand across the US economy combined with Ethernet's improving standards, increased availability, and gradually declining costs fast-growing Ethernet service is now being sold across an ever-increasing range of market sectors.

This report examines the four major verticals that account for a majority of US retail Ethernet sales financial, healthcare, education, and government and projects Ethernet sales opportunities within them. We also consider a fifth (rapidly emerging, though still smaller) Ethernet vertical media/entertainment. While the expansion of carrier Ethernet into new customer groups is diluting the contribution of these top five verticals in terms of revenue percentage, these sectors continue to account for a majority of customer spending on carrier Ethernet, and will continue to do so for the foreseeable future.

U.S. Ethernet Vertical Markets: A Five-Year Market Forecast analyzes the condition of the retail carrier Ethernet market in the US and delivers a five-year revenue forecast for each of the five key verticals through 2015. It also examines the most significant issues and trends that will affect each key vertical in the US retail carrier Ethernet market over the next five years. Forecasts are provided not only for overall revenues, but also broken down and analyzed by regional domain (long-haul, metro, access), service topology (Ethernet private line, Ethernet virtual private line, Ethernet LAN), and projected bandwidth requirements.


This report is based on extensive interviews Heavy Reading conducted with senior executives and marketing and network professionals from ten companies that together account for more than 80 percent of retail carrier Ethernet service sales in the US. In many cases, we spoke with two, three, or more sources per company. The companies interviewed encompassed traditional major ILECs and international carriers, CLECs, ISPs, specialized infrastructure providers, and MSO cable telephony providers.

For a full list of the vendors ranked in our survey, click here.

The excerpt below shows our five-year forecast for Ethernet revenues in the financial vertical the largest sector for Ethernet business today. As the figure shows, revenues in this vertical are projected to grow from an estimated $375 million in 2010 to nearly $1.3 billion by 2015, at a 27.7 percent compound annual growth rate (CAGR) over the forecast period.

The following excerpt shows the same forecast, broken out by bandwidth level. As the figure shows, the highest-bandwidth segment of Ethernet lines greater than 1 Gbit/s, including 10 Gbit/s, 40 Gbit/s, and 100 Gbit/s is projected to grow strongest throughout the forecast period, as this vertical migrates inexorably to larger and larger bandwidth increments at steadily dropping per-Mbit/s rates.

Report Scope and Structure

U.S. Ethernet Vertical Markets: A Five-Year Market Forecast is structured as follows:

Section II provides background on Ethernet services and an overview of the retail Ethernet market, prominently including Ethernet adoption, cross-market drivers, application categories and expansion prospects, and decision factors between alternative services and technologies, as well as definitions of segments forecast.

Section III discusses the specific patterns of Ethernet adoption and applications in five major US retail vertical markets: financial, healthcare, education, government, and media/entertainment.

Section IV provides extensive market forecasts for these five verticals and detailed segment breakdowns by regional domain, service topology, and bandwidth levels.

The report is essential reading for a wide range of industry participants, including the following:
  • Service providers: What catalysts are driving the adoption of retail Ethernet services, and how will those drivers evolve over the next five years? What specific features do key verticals consider requirements for their Ethernet services? How will the massive upsurge in bandwidth needs influence demand for (and use of) Ethernet services in the future? How quickly will demand for the highest-bandwidth services emerge, and from where? In what ways will government policies shape each of the largest verticals for your services?
  • Equipment vendors: How well do the capabilities of your carrier Ethernet equipment align with evolving demand for specific features from Ethernet end users? Can your product portfolio be positioned better to meet the demands from key verticals for Ethernet services? How will future trends in bandwidth demand shape requirements for advanced Ethernet technologies? What criteria do network operators consider when building Ethernet service offerings to meet future demand?
  • Investors: While Ethernet services may remain "recession-proof" on the whole, which providers are best positioned to follow the direction the market is shifting? What sectors will drive future demand for Ethernet, and what unique requirements will those verticals impose on service providers? How will public policy influence demand for Ethernet in the largest vertical sectors? How will the increasing "democratization" of Ethernet influence winners and losers in this fast-growing sector?

U.S. Ethernet Vertical Markets: A Five-Year Market Forecast is published in PDF format.