Gartner Dataquest Says Worldwide Service Provider Router Market Totaled $428 Million in the First Quarter of 2003.

Business Editors/High-Tech Writers

STAMFORD, Conn.--(BUSINESS WIRE)--May 15, 2003

The worldwide service provider router (SPR) market totaled $428.2 million in the first quarter of 2003, which is down 4 percent from the fourth quarter of 2002, according to Gartner, Inc. (NYSE:IT) (NYSE:ITB).

"The SPR market's sequential decline is probably because of economic conditions and uncertainty in the market because of the war in Iraq," said Jennifer Liscom, principal analyst for Gartner's worldwide telecommunications and networking group. "The first quarter is typically a slow quarter for this market, but results from the past two quarters indicate that the market has stabilized. Increased competition by two new players, Procket and Caspian Networks are expected in the second half of 2003, possibly driving pricing downward and changing market share dynamics.

Cisco Systems continued to dominate the worldwide SPR market, as its revenue reached $236 million in the first quarter of 2003 (see Table 1). Juniper was the No. 2 vendor in the market, with revenue totaling $129 million. Juniper delivered a strong quarter in the edge SPR market with the M- and E-series products.

Table 1
Worldwide Service Provider Router Vendor Revenue Estimates for 1Q03
(Millions of Dollars)

Vendor                      1Q03 Vendor Revenue  1Q03 Market Share (%)
----------------------------------------------------------------------
Cisco                                    235.7                   55.0
Juniper                                  128.8                   30.1
Redback                                   24.7                    5.8
Nortel                                    11.5                    2.7
Others                                    27.6                    6.4
Total                                    428.2                  100.0
----------------------------------------------------------------------
Source: Gartner Dataquest (May 2003)

Cisco also led the market in terms of shipments (see Table 2). However Juniper, continued to take market share away from Cisco. Juniper's strong showing in the edge segment boosted its unit shipments by 12 percent.

"The first quarter is indicative of market behavior for 2003, where we believe the behavior of the SPR market this year will change from large quarter-over-quarter fluctuations to mild gains and losses while positioning itself for stronger growth in 2004," said Liscom. "First quarter results are consistent with this scenario."

Table 2
Worldwide Service Provider Router Vendors' Shipments
Estimates for 1Q03
(Units)


Vendor                           1Q03 Shipments  1Q03 Market Share (%)
----------------------------------------------------------------------
Cisco                                    1,559                   50.5
Juniper                                  1,015                   32.8
Redback                                    205                    6.6
Nortel                                      71                    2.3
Others                                     240                    7.8
Total                                    3,090                  100.0
----------------------------------------------------------------------
Source: Gartner Dataquest (May 2003)

Gartner defines SPRs as carrier-class routers capable of providing multigigabit bandwidth in support of high-speed WAN interfaces. These carrier class devices are typically designed for installation in network infrastructure and support the Internet Protocol suite.

Additional market information for the SPR market are available in the Gartner Dataquest market statistics report "Worldwide Service Provider Market Shares, 1Q03." This report provides a breakout by region and function. This report can be purchased on Gartner's Web site at www.gartner.com/DisplayDocument?id=394910&ref=g_search.

This analysis is provided by Gartner's worldwide Telecommunications and Networking group. This group provides an analysis for the full spectrum of telecom and networking issues. To keep up to date on the latest telecommunications issues, please visit Gartner's Telecommunications Focus Area at www.gartner.com/telecom-mkt. To purchase the report or subscribe to Gartner programs, call 408-468-8000 or go to www.gartner.com.

About Gartner

Gartner, Inc. is a research and advisory firm that helps more than 10,000 clients leverage technology to achieve business success. Gartner's businesses consist of Research, Consulting, Measurement, Events and Executive Programs. Founded in 1979, Gartner is headquartered in Stamford, Connecticut and has over 3,800 associates, including approximately 1,000 research analysts and consultants, in more than 75 locations worldwide. Fiscal 2002 revenue totaled $888 million. For more information, visit www.gartner.com.