ABI Research revealed in their latest broadband CPE study that the overall market grew 2.5 percent year over year in 2011, illustrating the fact that consumers aren't willing to give up their broadband connection even during a challenging economic time.
According to its study, the cable and fiber-based CPE equipment segments grew 12 percent and 15.5 percent year over year, respectively.
From a vendor perspective, Shenzhen, China-based TP-LINK was one of the fastest growing broadband CPE companies, increasing its market share by almost 10 percent and shipping 35 million DSL broadband products. What's fueling growth of broadband CPE vendors, particularly ZTE (Shenzhen: 000063.SZ), Huawei, and TP-LINK, was their growing presence in global emerging broadband markets in Asia-Pacific, Latin America, and Eastern Europe.
Alternatively, NETGEAR (Nasdaq: NTGR) and D-link continued to grow marginally through 2011, while Cisco (Nasdaq: CSCO) and Technicolor lost to increasing competition worldwide, including North America and Western Europe, two markets where they have been traditionally dominant players.
ABI says said that established broadband markets such as Western Europe and North America are turning into "equipment replacement markets with mature broadband penetration."
The CPE market itself is also going through its own transition. ABI said the market "continues to consolidate through mergers and acquisitions with an increasing focus on regional competition through tailored portfolio of products for key regions."
Despite the changing market dynamics by the key players, the demand for broadband CPE continues to be ripe.
As consumers want to use multiple devices to access an array of over the top voice and video services in their homes, more service providers are ramping up the demand for broadband routers and gateways. These devices are being used not only to support current services such as IPTV and higher speed broadband, but as "future proof" elements to enable emerging services such as home monitoring and control and IPv6 support.
"Increases in multiple users and devices per household are contributing to operator's preference for routers and gateways (rather than simpler modems) worldwide," ABI Research said. "Service providers are inclined to offer higher computing power at the customer premise, especially in regions with higher ARPU rates."
- see the release
Verizon and Best Buy's Geek Squad team up to help SMBs
MoCA is the popular home networking mechanism of choice, says Infonetics
802.11ac will enhance online video experience; France's Minitel taken out of service
Week in research: Broadband subscriptions pass 600M; smart home opportunity broadens