MARKET REVIEW Ethernet sales spur fast m
Ethernet is the fastest growing connectivity technology for business and a key enabler for a range of important communication solutions and business applications including Unified Communications, SaaS and cloud-based services.
T
he Ethernet market is growing tremendously as more and more
customers move from legacy data services to Ethernet. BT Wholesale believes this migration is due to a number of factors – bandwidth demand is ever increasing spurred on by the growth in applications like storage, conferencing and a multitude of cloud services. But above all Ethernet is being seen as a flexible, versatile and cost-efficient product that supports converged voice and data traffic. “Ethernet enables customers to do more for less, and it’s a natural communications choice in this tough economic climate,” said Colin Annette, Client Director, BT Wholesale.
Demand for Wholesale Ethernet has more than doubled over the last year, reports Annette. “We expect this growth to continue in the coming year,” he said. “BT Wholesale’s Ethernet offering will be boosted by key service and access enhancements which we believe will further increase its appeal. Ethernet has become the connectivity choice for customers in the UK market taking the place of legacy technologies such as Frame, ATM and TDM.”
Entanet has also seen huge growth in demand for more speed and scalability in Ethernet services, either as standalone connections or within wider IP virtual private network solutions, says its Head of Marketing, Darren Farnden. “As IP and the Internet increasingly underpin businesses’ information systems and ways of communicating with suppliers, partners and customers, their demand for reliable and guaranteed connectivity has become more and more essential,” he said. “This, coupled with falling costs of Ethernet and cost-effective technologies such as EFM, makes Ethernet a profitable area for us and our channel resellers.”
Ongoing growth Farnden expects this trend to continue for the foreseeable future, especially as businesses continue to adopt new Internet-based technologies such as hosted applications and voice to improve efficiency and cut costs. “Entanet has a key objective to grow its Ethernet business during 2011 and beyond, and we aim to do that through developing our channel of Ethernet partners, by empowering them and providing them with all of the
tools and resources they need to confidently sell Ethernet services,” added Farnden.
Ethernet represents Zen’s fastest growing connectivity technology and is the fundamental enabler for its developing cloud proposition. “Developing our commercial proposition and service delivery is a key priority over the next 12 months,” said Andrew Saunders, Head of Product Management and Marketing. “Zen’s Internet Access Ethernet business is growing at over 30 per cent and we expect this growth to continue as we expand our network reach and as demands for high performance and reliable bandwidth services continue to grow. Our multi-site IP VPN business continues to grow exponentially with high bandwidth Ethernet Connectivity a key driver in this success as it is the access technology of choice for critical sites.”
The key challenge for resellers is to justify the additional investment to their customers. Ethernet Leased lines cost around 10 times that of a broadband service. That is a big price jump so resellers need to be sure they can clearly
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Darren Farnden
Ethernet is a profitable area for us and our channel partners
justify this price premium. “We work closely with our resellers to help them communicate the benefits of our Ethernet proposition and service wrap providing pre- prepared campaign materials to support the marketing campaigns,” said Saunders.
Last year Openreach saw Ethernet volumes grow in the order of 20 per cent, however, this is a mix of new growth and replacement of legacy technology. “This year we’re expecting to see that growth continue to accelerate,” said Richard Thorpe, General Manager of Ethernet Services, Openreach. “2011 has already seen an evolution from legacy dual fibre Ethernet products which are steadily being replaced
with the new generation single-fibre products, such as our Ethernet Access Direct Products (EAD). Here in Openreach, we have also invested heavily in the systems to support the growing product consumption requirements - ease of doing business for the channel and customer experience as transparent to the end- users and will be key to the continuing rapid growth.”
With Ethernet now the de-facto data technology, Openreach is focusing on developing the wider use and availability of Ethernet as bandwidth becomes more cost-effective and the technology more widespread. “We expect the market to be
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