The enterprise network switch market is estimated to grow at a CAGR of 8.62% during the forecast period.
An enterprise network switch is a networking device that is used to connect multiple devices on a network. Enterprise network switches are used in various areas and industries where there is a need for robust and efficient local area network (LAN) infrastructure such as corporate offices, data centers, healthcare facilities, and more. The increasing adoption of cloud computing, the growing deployment of next-generation networking technologies along the rising demand for network management and monitoring has emerged as significant driving force behind the substantial growth of the enterprise network switch industry.
Market Drivers:
Enterprise network switches play a crucial role in enabling smooth data transfer and secure access to cloud applications, fostering efficient communication between local networks and cloud platforms. With the increasing shift to cloud-based operations, the demand for high-performance switches has surged, allowing for the effective handling of substantial data volumes and uninterrupted connectivity between on-premises networks and cloud environments. The scalability and durability of these switches are essential in meeting the escalating data transfer requirements between on-premises networks and cloud services. By delivering dependable and secure connections, these switches are fundamental in facilitating the seamless integration of cloud-based applications and services into organizational workflows.
Enterprise network switches play a critical role in enabling the implementation of next-generation networking technologies, facilitating enhanced data transfer speeds, improved network performance, and the integration of cutting-edge networking capabilities. The adoption of next-generation networking technologies, such as 10GbE, 40GbE, 5G, and IoT is driving the need for enterprise network switches that can support higher data transfer speeds and large volumes of network traffic. For instance, according to Cisco’s annual internet report 2018-2023, by 2023, global mobile devices will grow from 8.8 billion in 2018 to 13.1 billion, and 1.4 billion of those will be 5G capable. According to the report, 5G speeds will be 13 times higher than the average mobile connection by 2023 with the average 5G connection speed reaching 575 Mbps.
Enterprise network switches are crucial for effective network management, allowing administrators to monitor activity, regulate data traffic, and ensure seamless connectivity across devices. With the growing complexity of modern networks, the demand for switches supporting advanced management features is on the rise, addressing the need for optimal performance and security. These switches enable administrators to enforce security measures and streamline network configurations, fostering a secure and efficient network infrastructure. By providing centralized control and advanced management tools, they enhance the overall resilience and agility of network environments, effectively meeting the evolving demands of the current interconnected business landscape.
North America is expected to dominate the market.
North America is projected to account for a major share of the enterprise network switch market owing to the presence of leading technology companies in the region, rapid technological advancements, and government support which stimulates the enterprise network switch’s demand. For instance, in 2023 National Science Foundation allocated $25M for the advancement of secure operations and communication via 5G networks in the United States. 5 NSF-funded teams have been chosen for the NSF Convergence Accelerator Phase 2 program, enabling the ongoing development of 5G solutions. Also, the prevalence of significant industrial ethernet switch providers in North America such as Cisco, Hewlett Packard Enterprise, LANTRONIX, INC, CDW Corporation, and NETGEAR led to significant innovations in enterprise network switches in the region.
Market Challenges:
The growth of the enterprise network switch industry may be restrained by their high deployment costs. The initial investment costs can be a significant barrier, especially for small and medium-sized businesses (SMBs) with limited budgets and resources. For these businesses, the cost of implementing and maintaining complex networking infrastructure, especially for large-scale networks or data centers, can pose a considerable financial burden and may require the enterprise network switch industry to opt for open-source networking, subscription-based networking services or leasing and financing options for enterprise network switches to spread out the cost.
Market Developments
Company Products
| Report Metric | Details |
|---|---|
| Study Period | 2021 to 2031 |
| Historical Data | 2021 to 2024 |
| Base Year | 2025 |
| Forecast Period | 2026 – 2031 |
| Report Metric | Details |
| Growth Rate | CAGR of 8.62% from 2022 to 2029 |
| Base Year | 2022 |
| Forecast Period | 2024 – 2029 |
| Forecast Unit (Value) | USD Billion |
| Segments Covered |
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| Companies Covered |
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| Regions Covered | North America, South America, Europe, Middle East and Africa, Asia Pacific |
| Customization Scope | Free report customization with purchase |
Segmentation