The transition from the 802.11n standard to the newer and faster 802.11ac standard is progressing rapidly and above expectations in the enterprise segment. After just four quarters of product availability, the 802.11ac standard already accounts for 19% of dependent access point shipments and 30% of dependent access point revenues, a noticeably faster adoption rate than what the market experienced with the 802.11a/b/g to 802.11n transition several years ago. The primary reasons behind this trend lies with aggressive pricing for the 802.11ac access points adopted by most vendors with minimal or no price premium over the 802.11n products and to the inherent benefits of 802.11ac products in high density environments.
The consumer WLAN market had a very good quarter in 2Q14, growing 10.9% year over year. The gains in the consumer WLAN space benefitted from the ongoing transition from the older 802.11n standard to the newer and faster 802.11ac standard as well as a solid performance in emerging markets, particularly in Asia/Pacific where China, as the second largest consumer WLAN market (behind the United States), jumped 36.9% year over year in revenue and a massive 81.3% in unit shipments.
"The continued worldwide growth of WLAN across different verticals and use cases demonstrates WLAN's importance to today's enterprise, as it supports a growing number of business-critical mobility applications," said Rohit Mehra, Vice President, Network Infrastructure, at IDC. "While growth has stabilized, enterprise requirements around mobility and cloud applications, as well as the emergence of the Internet of Things, are driving network upgrades and greenfield deployments. This, along with the rapid uptake of the 802.11ac standard, will help sustain WLAN market growth in the near to mid-term."
From a geographic perspective, the enterprise WLAN market performed especially well in Latin America with its 35.4% year-over-year growth in 2Q14. Leading the charge in the region were Brazil (up 61.5% year over year) and Argentina (up 51.3% year over year). The Europe, Middle East, and Africa (EMEA) region followed with a solid increase of 20.7% year over year that was spread relatively evenly across the region including good performances in the large economies of Western Europe. Notable year-over-year increases in this region included France (up 33.4% in 2Q14), the United Kingdom (24.9%), Spain (22.9%), and Italy (12.1%). The Asia/Pacific enterprise WLAN market grew more modestly at 10.5% year over year due to weakness in Korea (down -15.8% year over year) and Indonesia (-29.3%). Still, other major Asia/Pacific countries performed well in 2Q14 with China growing 13.6%, Japan adding 16.2%, and Australia increasing by 12.5% year over year in 2Q14. North America, on the other hand, declined -1.2% year over year in 2Q14.
"Although growth was flat for some of the traditionally strong vendors and regions in 2Q14, the worldwide enterprise WLAN market remains strong as technological innovations, along with increasing network demands, drive investments in network infrastructure," said Petr Jirovský, Research Manager, Worldwide Networking Trackers.
Key Enterprise WLAN Vendor Updates
- Cisco's 2Q14 worldwide enterprise WLAN revenue underperformed the overall market and was down -2.3%, despite growing 11.2% quarter over quarter after the seasonally weaker 1Q14. Cisco's performance was impacted by relative weakness in the service provider vertical in North America and Asia/Pacific. Cisco's worldwide market share stands at 46.8% in 2Q14, down from 48.1% in 1Q14 and 51.6% in 2Q13.
- Aruba (excluding its OEM business) had a very strong quarter in 2Q14, growing 19.1% year over year and 12.5% sequentially on strength across its product portfolio, including the 802.11ac and Aruba Instant product line. Aruba's market share increased to 11.8% of the enterprise WLAN market, up from the 10.6% in 2Q13.
- Ruckus also significantly outperformed the overall enterprise WLAN market after growing 27.7% year over year and 7.4% quarter over quarter in 2Q14. Ruckus now accounts for 6.2% of the overall market, up from 5.3% in 2Q13.
- HP's 2Q14 revenue underperformed the overall market and decreased -17.5% year over year despite growing 15.4% quarter over quarter. As a result, HP's market share dropped to 4.5% of the market from 5.8% in 2Q13.
The IDC Worldwide Quarterly WLAN Tracker provides total market size and vendor share data in an easy-to-use Excel pivot table format. The geographic coverage includes eight major regions (USA, Canada, Latin America, Asia/Pacific (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.
For more information about IDC's Worldwide Quarterly WLAN Tracker, please contact Kathy Nagamine (email@example.com).