Inside Routers: Who Are the Major Players in the Routing Market?


Nov. 20 2020, Updated 3:24 p.m. ET

What are routers?

A router is connected to a minimum of two networks. It basically decides which way to send each information packet, based on the understanding of the networks. A router is located at a gateway and is generally part of a network switch. An edge router interfaces with an ATM (asynchronous transfer mode) network.

By comparison, a NGN (next generation network) is a packet-based network that provides telecommunication services. NGNs can make use of multiple broadbands and add quality of service to transport technologies, where service-related functions are independent of the underlying transport-related technologies. It offers unrestricted access by users to different service providers and supports generalized mobility that allows consistent and universal provisions of services to users.

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Competition in core routers

Historically, Cisco Systems (CSCO) and Juniper Networks have controlled the core router space with a combined market share of more than 80%. But this scenario changed with the re-entry of Europe’s (FEP) Alcatel-Lucent (ALU) into this segment.

At the same time, Alcatel-Lucent’s market share in edge routing has grown to 24%. The company edged out Juniper Networks (JNPR) to become the number-two vendor in this segment in 2010, despite entering the market in 2003. Alcatel-Lucent can use this platform as leverage to increase its market share in the core router space as well. Notably, Alcatel-Lucent was acquired by Europe’s (EFA) Nokia (NOK) in 2015.

In the next part, we’ll analyze the key growth drivers in the routing market.


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