The report continues by showing that while white box switches are most prevalent in the high-speed top-of-rack (ToR) market, branded switch shipments saw a significant rise in this area — 40 percent in 2014 alone.
Seamus Crehan, president of Crehan Research, notes that a large portion of the white box and ODM-direct switch market is influenced by a limited number of hyperscale cloud service providers. Therefore, the resulting growth of the white box market has been largely based on these few organizations’ data center network needs.
The switch vendors have pushed back against white boxes, however. Their efforts have included cutting prices, introducing more merchant silicon, providing more programmability and software-defined networking (SDN) components, disaggregation of hardware and software, and incorporating more open compute and networking designs to market.
“The perceived gap between white box and branded switches has really been narrowed by the branded providers as of late,” says Crehan. “These vendors have done a lot to make white box switching less attractive.”
Still, white box networking has its niche. Its adoption has been widely spread across the SDN market, but branded switches keep growing in the market and turning out higher revenues, despite the price declines.
“The reason for revenue being relatively stable and for continued revenue growth despite the steep price cuts is because the cuts are in some of the higher-speed segments,” says Crehan, noting 100-, 40-, and event 10-Gb/s switches. “As a result of that, there is more adoption of those higher speed switches, which is holding the overall price up.”
Crehan also says the market will continue to grow, in the high-single-digit range for the next five years.