REDWOOD CITY, Calif. – July 18, 2023 – According to a recently published report by Dell’Oro Group, the trusted source for information about the telecommunications, security, networks, and data center industries, twenty percent of Ethernet Data Center Switch ports will be connected to accelerated servers to support Artificial Intelligence (AI) workloads by 2027. The rise of new generative AI applications will help fuel more growth in an already robust data center switch market, which is projected to exceed $100 B in cumulative sales over the next five years.
“We anticipate an outstanding market performance for 2023, marking the third successive year of double-digit growth and a new sales record,” said Sameh Boujelbene, Vice President at Dell’Oro Group. “While challenges such as backlog normalization, data center capacity digestion, and spending optimization may temporarily impact market growth in 2024, we expect a swift rebound, with sales returning to double-digit growth throughout our forecast horizon.
“Our current market sizing does not even encompass the full potential growth propelled by the rise of new generative AI applications and Large Language Models (LLMs). These groundbreaking AI applications necessitate a distinct AI network known as the back-end network, which serves as the infrastructure to connect all accelerated servers. This back-end network differs from the front-end network used to connect general-purpose servers, which is the main scope of this current Ethernet data center switch report. Our future research will focus on tapping into the market potential driven by back-end networks that leverage a blend of Ethernet and InfiniBand technologies,” added Boujelbene.