It's the need for speed, stupid.
Two recently released studies show that higher speed connections to desktops and across local networks are driving growth in the switching industry.
Quarterly results released by market researchers the Dell'Oro Group and In-Stat show that Fast Ethernet, a version of the popular network architecture that transmits data at 100 mbps (megabits per second) speeds, is driving sequential growth in the market for network switching equipment.
Both studies focus on two areas: the number of ports sold in hubs (a device that allows users to share bandwidth) and switches (the boxes that allow dedicated connections to be allocated to users).
Fast Ethernet switch ports out-shipped shared media ports found in hubs for the third quarter of the year, according to the In-Stat study. The Dell'Oro Group released similar findings, with growth in Fast Ethernet driving much of the gains in shared hubs and local area switches.
In-Stat found that the total market for LAN (local area network) switches and hubs grew 7 percent quarter-to-quarter, totaling $2.63 billion in revenue. The Dell'Oro Group pegged the market's growth at 9 percent sequentially, with total sales topping $2.4 billion.
Fast Ethernet switch sales increased about $200 million quarter-to-quarter, according to the Dell'Oro study. Leading the pack in shared hubs and LAN switches for the quarter, according to The Dell'Oro Group, was Cisco Systems, with $605 million in sales. 3Com and Bay Networks trail the networking giant by roughly $200 million each.