Gartner: LAN market to grow slowly in Japan

Japan's computer network equipment market will achieve modest growth averaging 6.4 percent per year between now and 2005, according to a new report published by market research company Gartner Japan Ltd.

The market, which is defined as that for routers, LAN switches and hubs, will hit 600 billion yen (US$5 billion), said Gartner in a statement Friday summarizing the report. The modest forecast is in contrast to the strong growth that has been seen over the last few years.

LAN switches will make up the strongest growing sector of the market, said Gartner. Shipments in value terms are expected to rise from 168.6 billion yen in 2000 to 297.3 billion yen in 2005, with the total number of ports shipped per annum jumping from 11.7 million in 2000 to 27.5 million in 2005.

Router sales, which jumped just over 80 percent by value year-on-year to hit 169.0 billion yen in 2000, are forecast to hit 296.6 billion yen in 2005, positioning the sector just behind switches as the second fastest-growing sector of the network equipment market. The number of units shipped per annum is expected to jump from 758,000 in 2000 to 1.2 million in 2005.

In the low-end hub market, the value of sales is expected to drop from 10.0 billion yen in 2000 to 3.1 billion yen in 2005, while the number of ports shipped will contract from 5.3 million to 2.6 million over the same period, said Gartner. The falling price of low-end switches is expected to mean they eat into this market over the coming years.

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