COVID-19 Hits Supply Chain; Demand Varies Based on Vertical and Geography

PORTOLA VALLEY, Calif – May 27, 2020 – A newly released report by 650 Group, a leading market intelligence research firm for communications, data center, and cloud markets, indicates that the Ethernet Switch Market declined nearly 10% Y/Y on weak campus and data center results in 1Q20, declining to approximately $7B. The report also indicated significant regional differences amongst vendors, as well as aggressive ASP fluctuations in the market.
“The Ethernet Switch market contracted in the expected regions and verticals in 1Q20,” said Alan Weckel, Founder and Technology Analyst at 650 Group. “Supply chain constraints in factories and components remain entering the last month of 2Q20. Certain component shortages will remain well into 2021 as vendors prioritize customers and products throughout the year.  Our vertical analysis of the campus and data center Ethernet switching markets indicates a different recovery rate and use of technology as the market begins to rebound in 2H20.  Digital transformation and the use of cloud platforms will be critical to companies going forward, especially as the digital divide increases across regions and customers.”
The 650 Group Quarterly Ethernet Switch report also indicates what impact the trade war is having on campus suppliers and the surge in 25 Gbps port shipments from H3C and Huawei.  
The report highlights how campus Ethernet switching outperformed data center switching with new products from Arista, Cisco, Extreme Networks, and Juniper all ramping during the quarter.
About the Ethernet Switch Quarterly Report The Ethernet Switch Quarterly Report offers a market assessment of vendor performance and market share in the Ethernet Switch market.  The report covers Modular, Fixed Managed, Smart Switching, White Box, Disaggregation, and other segmentation as well as the following port speeds: 100 Mbps, 1 Gbps, 2.5 Gbps, 5.0 Gbps, 10 Gbps, 25 Gbps, 40 Gbps, 50 Gbps, 100 Gbps, 200 Gbps, 400 Gbps, and 800 Gbps.  
For more information about the report, contact the sales department at 650 Group at +1 650 600 7104 or val@650group.com or www.650group.com.

About 650 Group 650 Group is a leading Market Intelligence Research firm for communications, data center and cloud markets.  ​Our team has decades of research experience, has worked in the technology industry, and is actively involved in standards bodies.


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Surge Spending and Different Usage Patterns Change 2020 and 2021 CAPEX Trends

PORTOLA VALLEY, Calif.  May 5, 2020 —  According to a newly released report issued by founding analysts of 650 Group, the US Hyperscaler Cloud market revenue grew 20% Y/Y in Q1’20 while CAPEX used for Data Center Equipment grew unevenly during the same timeframe.

650 Group’s Cloud Report covers Colocation, IaaS, SaaS, and Search & Social.

Q1’20 Highlights:
* o    Revenue Growth for US Hyperscalers was the slowest it has been in a decade
* o    The majority of Cloud Providers lowered CAPEX projections for 2020
* o    US Hyperscaler Cloud providers are running their servers and networks more efficiently compared to 2019, allowing them to surge capacity at a faster rate than DC buildouts
* o    Surge capacity in Q1’20 was very different between Search and Social companies like Facebook and Google and IaaS companies like Amazon and Microsoft.
* o    Capital Equipment Expenditures were constrained by supply constraints related to COVID-19; supply constraints remain in 2Q’20

The Cloud reports include CAPEX studies for the Colocation, IaaS, SaaS, and Search and Social Media markets, including a unique look at spending specifically for data center equipment.  Going beyond just Cloud revenue provides a unique look into where and how the largest Cloud providers deploy equipment.  In the report, you can see the trend towards more CAPEX spending occurring in IaaS as many SaaS providers choose IaaS instead of building out their own infrastructure.

“Q1’20 Cloud results diverged from normal seasonality as the world rapidly shifted to work-from-home and remote forms of social and society interaction,” said Alan Weckel, founding analyst for 650 Group. “Cloud-based companies became increasingly important to society as social norms changed rapidly during Q1’20.  For businesses, the use of Cloud services becomes even more important in all verticals.  As we look towards the second half of 2020, companies that better use cloud resources to do business will emerge in a stronger position.”
For more information about the report, contact the sales department at 650 Group at +1 650 600 7104 or val@650group.com or www.650group.com
About 650 Group 650 Group is a leading Market Intelligence Research firm for communications, data center, and cloud markets.  ​Our team has decades of research experience, has worked in the technology industry, and is actively involved in standards bodies.  650 Group focuses on leading-edge market trends and research and prides itself on first to market research.