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The growth in the enterprise router segment has been moderate in the last couple of years due to lack of true application integration, and secure and scalable platforms. BFSI, e-governance, government and defense, retail, telecom/service providers, educational institutions and banking sectors are the key verticals contributing to the revenue of major players in the router space.

In today's networking space, the role of router has evolved far beyond merely moving packets. Network routers are increasingly being tasked to do more than traffic forwarding and are also required to apply intelligent controlling and reporting decisions based on enterprise policies.

Performance Indicator
The router market has shown marginal growth during FY 2008-09. The market grew by 10.5% to touch Rs 2,000 crore as compared to Rs 1,810.3 crore in FY 2007-08. Cisco reported a negative growth of -2% in the router segment, and registered revenues of Rs 1,415 crore this fiscal, as compared to Rs 1,444 crore in FY 2007-08. Still, it secured the #1 position with nearly 70.7% market share. Juniper held the second position with revenues of Rs 300 crore as compared to Rs 192 crore during last fiscal. The company recorded a 56.3% growth with a market share of 15%.

Another major player, DAX Networks, showed marginal negative growth of –1.8% and its revenues declined to Rs 54 crore this fiscal as compared to Rs 55 crore in FY 2007-08. BA Systems, on the other hand, improved marginally from Rs 11.6 crore in FY 2007-08 to Rs 13 crore in FY 2008-09, a growth of 12.1%. D-Link recorded a phenomenal growth of 57.1% and registered revenues of Rs 11 crore in FY 2008-09.

Hottest Trends
Over the years, the role of networks has evolved. However, today networks are expected to offer increased and diverse functionality. Organizations are finding out ways of improving the agility needed to respond to and capitalize on changes, while decreasing costs.

Adapting to the changing needs of organizations, router have today matured into integrated devices. Large enterprises are seeking a truly futuristic approach for their router moving towards deploying intelligent and optimized hardware/software platforms to guarantee embedded security, VPN and significant performance. At the same time, enterprises are also trying to enable their router to provide other services such as, covering voice over IP, videoconferencing, WAN optimization, and network analysis.

WAN is becoming a compelling need for banks, consumer companies, government, and IT service companies. And router have a very critical role to play as far as wide area connectivity is concerned.

As an evolving trend, router is coming with tight integration and security features such as firewall/encryption. Besides IP VPN over last mile wireless links, perimeter security router have a major market in India.

The router market is moving towards integrated devices with built-in multiple capabilities. Given the boom in the Indian telecom space, carrier class router, with the capability to handle and route data in terabits, will be piloted and deployed. IPv6 enabled router, access control by integrating the router with dedicated anti viruses, IDS, IPS device bandwidth bundling/load balancing with multiple Internet links are some of the recent trends.

New Offerings
This year has seen the arrival of a lot of new and exciting technologies. There have been many innovations by Juniper Networks in the routing segment like router capable of supporting 100G interface, router that requires less power bit, generates less heat per bit and requires less cooling per bit, etc. Another major addition by Juniper is TX Matrix Plus and JCS 1200 designed to help bring about the virtualization of highly scalable and adaptable core router.

These apart, IPv6, SSL-VPN, IPS, and hardware encryption module are some of the hottest technology additions by D-Link during the last fiscal. Another major player, DAX Networks has also strengthened its product portfolio by adding, router delivering high throughput, multiple functionality in a single product, IPV6 enabled router, increased performance on existing platforms.

One of the most significant additions in Cisco's product kitty is Cisco ASR 1000 Series Aggregation services router. It features software virtualization to enable 'instant-on' provisioning and simultaneous use of a wide range of service functionality, including firewall, IP security virtual private networks, deep-packet inspection, and session border control.

Major Orders
Despite the economic downturn, most of the major companies have bagged huge orders. DAX Networks has bagged a number of big orders from companies like Sutex Co-op Bank, Baroda City Co-op Bank, Manapuram Finance, Gujarat Electricity Board, and Department of Finance, Government of Madhya Pradesh.

In 2008-09 in the service provider segment, Juniper captured the market for next generation networks. They also made a significant breakthrough in branch networking in the banking segment. The company's growth was also fueled by additional SWAN projects.

On the other hand, D-Link has bagged some major orders and projects in various government sectors such as railways, army, and disaster management. The company has also pitched in new segments like government and participated in SWAN projects.

BA Systems also bagged many big orders from companies like Net4India, Netmagic, NetTech, etc. Also, some major government orders came for STPI, MESCO Steel, Orissa Cements, BSNL Dotsoft, Rajasthan VAT and Forest Research Institute. It also received contracts from BFSI segment, education segments, enterprise and IT-ITeS segment.

Steady Growth Ahead
Business is surely growing for the router market. The market is demanding more of applications/services to be deployed rather than purely boxes. They have come to realize that deployment of router that are more intelligent than their predecessors provide them with better RoI.

Major players in the router segment believe that 2009-10 will be a challenging year for the industry. Organizations that have dominated the market over the years will have to prove their worthiness for the premium they demand for their products.

Arpita Prem
arpitap@cybermedia.co.in