Cloud data centers to drive transition to 400G, and a $14B Ethernet switch market

A data center
A number of service providers like Windstream are extending their fiber to key data centers.

Cloud data centers will play a key role in the next big speed jump for networks, from 100 Gbps to 400 Gbps, and that will have a positive effect on the Ethernet switch and data center market overall—to the tune of $14 billion by 2021, research firm Dell'Oro Group predicts.

Besides Google, all of major cloud service providers are asking for 400 Gbps. Dell'Oro anticipates that as 400 Gbps optics become readily available, that will become the next major network speed goal.

Over the forecast period, Dell’Oro said that disaggregation of the switch hardware and switch operating system will spread “significantly beyond white box systems.”

DCI gains momentum

One of the main trends that’s been gaining momentum in the data center space is data center interconnect (DCI). Attracting a host of traditional ILECs and competitive providers, DCI offers access to multiple service providers, adding to available data center switching deployment scenarios. 

RELATED: 25G Ethernet consortium releases 25G/50G Ethernet specification, focuses on multivendor interoperability

By having a variety of connectivity options, data center providers can provide direct access to their servers, which is important during an outage or maintenance window for hardware and/or software.

A number of service providers like Windstream, which sold off its data center infrastructure, are extending their fiber to key data centers.

Windstream is establishing an ultra long-haul (ULH) network on the West Coast and it has also connections into the Miami market to carry traffic in and out of Latin America, for example.

25G, 50G drive product cycles

Sameh Boujelbene, senior director at Dell’Oro Group, said that there will be least two major product cycles by 2021.

“The first cycle will ramp this year and will be driven by 25 GE SERDES technology, mainly using Broadcom’s Tomahawk-based silicon,” Boujelbene said in a statement. “The second cycle will start in 2018-2019, driven mainly by 50 GE SERDES technology.”

In January, the 25G Ethernet Consortium completed the first 25G and 50G Ethernet plugfest at the University of New Hampshire InterOperability Laboratory (UNH-IOL) in Durham, New Hampshire.

Previously, UNH-IOL began offering 25 Gbps Ethernet Testing at its facility, targeting equipment vendors that were selling to data center providers and service providers that use higher network speeds to support cloud-based services.

Dell’Oro forecast in a previous report that 25 Gbps speeds will drive the second-highest server Ethernet port sales and shipments by 2018.