The combined enterprise and consumer wireless local area network (WLAN) market segments declined 3.6 per cent year-over-year during the third quarter of 2019, amid a vendor and customer transition to new technologies.
With worldwide revenues accounting for US$3.8 billion during the three-month period, IDC findings report an enterprise segment falling 1.1 per cent year-over-year to $1.62 billion. According to the analyst firm, the market is in a “state of transition” as a new wireless standard emerges.
On the flip side however, continued demand for wireless access technologies, alongside new advanced software management and automation capabilities, are expected to drive future growth.
Specifically, the entrance of the 802.11ax wireless standard, also known as Wi-Fi 6, in the market gained share from shipments of previous generation 802.11ac products.
According to IDC, 802.11ac products accounted for 84.8 per cent of dependent access point shipments in the enterprise segment and 86.2 per cent of dependent access point revenues. Meanwhile, 802.11ax products made up 3.1 per cent of dependent access point shipments and 6.1 per cent of revenues.
"The enterprise WLAN market is transitioning as vendors and customers begin to adopt the latest Wi-Fi standard,” said Brandon Butler, senior research analyst, IDC. “In the third quarter of 2019, IDC tracked the initial shipments of 802.11ax, also known as Wi-Fi 6, which includes numerous features for enterprises and Internet of Things use cases.
“IDC expects the continued adoption of Wi-Fi 6 to be a major driver of growth for the enterprise WLAN market in the fourth quarter of 2019 and throughout 2020.”
Delving deeper, the consumer WLAN market dropped 5.3 per cent year-over-year to $2.18 billion with shipments of 802.11ac products accounting for 57 per cent of units shipped and 78.1 per cent of revenues.
The previous-generation 802.11n standard accounted for 42.8 per cent of shipments but only 20.8 per cent of revenues.
From a vendor perspective, Cisco's worldwide enterprise WLAN revenue fell 4.9 per cent year-over-year, but grew 1.9 per cent compared to the previous quarter. As a result, the vendor’s market share dropped slightly from 44.9 per cent to 44.2 per cent in consecutive quarters.
Combined revenues of Hewlett Packard Enterprise and Aruba increased 1.3 per cent year-over-year and rose 4.6 per cent sequentially. This resulted in market shares growing 14.1 per cent from 14 per cent a quarter earlier.
In third place, Ubiquiti's revenues rose 9.4 per cent annually and 8.6 per cent sequentially with market share growing to 7.1 per cent, from 6.8 per cent a quarter earlier.
Huawei's quarterly revenues rose to 11.2 per cent and were up 3.7 per cent sequentially, giving the vendor 5.4 per cent market share.
Rounding off the top five, CommScope was off 20.3 per cent year-over-year and was down 6.7 per cent compared to the previous quarter. This subsequently caused the vendor's market share to drop from 5.8 per cent in the second quarter to 5.2 per cent in the third quarter.
Geographically speaking, results in the enterprise WLAN market were viewed as “mixed across the globe”.
The Asia Pacific region, excluding Japan, increased 3.3 per cent annually during the third quarter, driven by China growing 6.9 per cent year-over-year. This is despite the Korean market falling 16.2 per cent.
“The enterprise WLAN marker saw mixed results regionally, in part influenced by macro-economic conditions that continue to disrupt the broader information technology sector," added Petr Jirovsky, research manager, IDC. “Most notable has been the continued trade standoffs between the United States and China, along with the unresolved Brexit situation and political unrest in Latin America.
“These macro-economic and political situations create uncertainty for global businesses, which can in turn lead to pausing or scaling back of investments.”