Plenty of growth ahead in frame relay!
Tuesday August 5 7:55 AM EDT
Company Press Release
Source: Frost & Sullivan
Frost & Sullivan: Recent Improvements Cause Tremendous Growth in
U.S. Frame Relay Equipment Markets
MOUNTAIN VIEW, Calif., Aug. 5 /PRNewswire/ -- Viewed as today's most viable technology available to meet the
information technology challenges of tomorrow, there is great potential in the market for frame relay equipment. Increased
demand for the product can be attributed to three main factors: improvements in frame relay networks, corporate needs for
greater bandwidths, and the growing need to interconnect Local Area Networks. End users continue to move large portions of
their SNA and private line traffic to frame relay networks for substantial cost savings.
According to strategic research conducted by Frost & Sullivan, U.S. Frame Relay Equipment Markets, both segments of the
market, access and switching, should experience very healthy growth rates through the decade and into the next century. Total
revenues for frame-relay equipment are expected to reach $12.8 billion by the end of 2003. The compound annual growth rate
(CAGR) from 1996 to 2003 is forecast to be 31.8 percent.
Most of the leading vendors in the market are large telecommunications equipment manufacturers that are publicly traded.
Typical customers targeted by these vendors include telecommunications carriers/service providers, large corporations, banks,
financial service companies, retail companies, and governmental agencies.
The frame-relay equipment market is dominated by several leading vendors. They include: 3Com, ADC Kentrox, Ascom
Timeplex, Bay Networks, Cascade, Cisco Systems, Hypercom, Larscom, Motorola, Network Equipment Technologies,
Newbridge Networks, Northern Telecom, and Paradyne. These companies must focus on three key competitive issues
including: pricing, complete product lines, and multi-functional products to provide end users with greater flexibility.
The growth of the frame relay market can be attributed to recent technological improvements. ``Frame relay equipment
products are becoming more multi-functional in nature,'' explains telecommunications industry analyst Grant Rose. ``Many
Frame Relay Access Devices (FRADs) and routers now come equipped with integral Channel Service Unit/Data Service Unit
(CSU/DSU) devices, eliminating the need for a stand-alone CSU/DSU. Also, many frame relay switches are now
multi-service switching platforms that can switch frame relay, ATM, and SMDS.''
Major trends occurring in the frame relay access equipment market include: Voice Over Frame Relay (VoFR), frame relay
switches, frame relay access equipment, Switched Virtual Circuit (SVC) capabilities, and interoperability among frame relay
access and switching equipment. VoFR is becoming popular among corporate end users to reduce the cost of intra-office long
distance calls, and is expected to become an integral feature of frame relay access equipment available to many
telecommunications equipment consumers.
Because interoperability among frame relay access and switching equipment is becoming mandatory, frame relay access
equipment is beginning to combine features and functionality. Frame relay switches are increasingly being used to integrate
various types of traffic such as X.25, frame relay, and ATM. Also, SVC capabilities are becoming popular features inherent to
frame relay access and switching equipment. All of these recent advancements lend to the increasing market potential for frame
relay equipment.
Many manufacturers in the frame-relay market pursue several different types of strategies in efforts to increase their market
sales. Some of these strategies are based on the development of multifunctional and flexible products, mergers and
acquisitions, extensive product lines, regulatory and legislative changes, interoperability and standards, specialization and niche
markets, and pricing.
Market Participants include: 3Com Corporation/Broadband Access Division, Access Beyond, Inc., Accton Technology
Corporation, ACT Networks, Inc., ACT Networks, Inc. ( formerly Dynatech Comm.), ADAX, Inc., ADC Kentrox.,
ADTRAN, Inc., Advanced Computer Communications, Inc. (ACC), Alcatel Data Networks, Alcatel Network Systems, Inc.,
American Technology Labs, Inc., Andrew Corporation., Ascend Communications, Inc., Ascom Timeplex, Inc., Astrocom
Corporation, Bay Networks, Inc., Bay Technical Associates, Inc., Bayly Communications, Inc., BBN Corporation, Black
Box Corporation, Cabletron Systems, Inc., Cascade Communications Corporation, Cisco Systems, Inc., Cisco Systems, Inc.
(formerly Newport Sys.), Coastcom , ComData Corp., Compatible Systems Corporation., CR Systems Corporation.,
CrossComm Corporation, Cylink Corporation, Develcon Electronics, Ltd., Digital Equipment Corporation, Digital Link
Corporation, DSC Communications Corporation, Eastern Research, Inc., Eicon Technology Corporation, FastComm
Communications Corp., Frame Relay Technologies, Inc., Fujitsu Network Communications, Inc., Gandalf Systems
Corporation, General DataComm Industries, Inc., Hewlett Packard, Inc., HT Communications, Inc., Hughes Network
Systems, Inc., Hypercom, Inc., IBM, Inc., International Transware, Inc., Intraplex, Inc., Larscom, Inc., Livingston
Enterprises, Inc., Lucent Technologies, Memotec Communications, Inc., MICOM Communications Corp., Microcom, Inc.,
Motorola, Inc., Multi-Tech Systems, Inc., NEC America, Inc., Netrix Corporation, Network Equipment Technologies, Inc.
(N.E.T.), Newbridge Networks, Inc., Northern Telecom, Osicom Technologies, Inc., PairGain Technologies, Inc., Paradyne
Corporation, Patton Electronics Co., Pivotal Networking, Inc., Premisys Communications, Inc., Presticom, Inc., Proteon,
Inc., Pulse Communications, Inc., Racal-Datacom, Inc., RAD Data Communications, Inc., RAScom, Inc., Retix, Inc., Shiva
Corporation, South Hills Datacomm, SSE Datacom, Storage Tech Network Systems Group, Sync Research, Inc. (formerly
Tylink), Sync Research, Inc., Telco Systems, Inc., Teleglobe, Canada., Telematics International, Inc., Telenetics Corporation,
Teleprocessing Products, Inc., Tellabs, Inc., TxPort, Inc., U. S. Robotics Corporation, Verilink Corporation, Xyplex
Networks, Inc., American National Standards Institute (ANSI), Federal Communications Commission (FCC)., Institute of
Electrical and Electronics Engineers (IEEE), International Telegraph and Telephone Consultative Committee/International
Telecommunications Union (CCITT/ITU), and Nuera Communications, Inc.
The technologies reviewed in this report include Frame Relay, Voice over Frame Relay, Digital Subscriber Loop Technology,
High Speed Internet Connections, Inverse Multiplexing, ATM, SONET, LANs, and ISDN.
Frost & Sullivan is an international marketing consulting company that monitors the telecommunications industry for market
trends, market measurements, and strategies. This ongoing research is utilized to update a series of research publications such
as #2835-61 U.S. Advanced Intelligent Network Equipment and Services Markets and to support industry participants with
customized consulting needs.
Visit the Frost & Sullivan web site: frost.com.
Report: 2647-61 Publication Date: June 1997 Price: $2450
SOURCE: Frost & Sullivan
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