Cisco's grip on service-provider routing, carrier Ethernet slips to 41 percent

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Cisco might still be the dominant router vendor in terms of units sold, but its influence appears to be slipping.

According to new data from Synergy Research, Cisco's share of the service-provider routing and carrier Ethernet market dropped to 41 percent in the second quarter, down 4 percentage points from the same period a year earlier.

Because of slow sales of its routing products, Cisco said in its fourth-quarter and fiscal-year 2014 earnings call that it would cut 6,000 jobs. Cisco's CEO and chairman, John Chambers, attributed the layoffs to challenges in emerging markets, particularly in China and Brazil, where sales have slowed and it is facing more competition from vendors such as Huawei.

Alternatively, Cisco's main competitors--Alcatel-Lucent (NYSE: ALU), Huawei and Juniper--all posted strong sequential and year-over-year growth in this segment.

Although Alcatel-Lucent reported that IP-routing revenues declined 7 percent, to $751 million, in the second quarter of 2014, the vendor said it is seeing "continuing growth in Asia Pacific and steady performance in EMEA." Likewise, Juniper reported that its routing and switching revenues rose 12 percent year-over year, to $618 million, and 25 percent sequentially, to $200 million.

Synergy said that overall second-quarter service-provider router revenues grew 9 percent year-over-year and 17 percent sequentially, driven by a 40 percent rise in Asia Pacific revenues compared with the same period of 2013. What's more, the amount of money spent on service-provider routers and carrier Ethernet hit an all-time high of $3.5 billion in the quarter.

For more:
- see the release

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