Bandwidth Use Soars

Welcome Guest. | Log In| Register | Membership Benefits

September 22, 1997

Bandwidth Use Soars

Survey: Companies still prefer frame relay over ATM to meet growing demand
By Mary E. Thyfault
orporate demand for bandwidth is growing rapidly, but traditional corporate expansion is driving that growth more than multimedia applications, according to a report released this month by Vertical Systems Group. To meet this demand, companies are deploying frame relay networks more readily than asynchronous transfer mode networks.
The findings, based on a survey of 4,429 companies and Vertical's annual market analysis of the ATM and frame-relay markets, reveal that bandwidth demand is growing by more than 30% per year. About 7% of the companies said their b andwidth needs increased more than 50% over the past year.
Corporate expansion-including mergers, telecommuters, and regional offices-is the major force behind demand increases, the companies said, though new database and multimedia applications also weigh in.
Enterprises are still primarily turning to frame relay networks to support bandwidth growth. Vertical, in Dedham, Mass., projects that the frame relay equipment and services market will grow from $3.5 billion in 1996 to $14.6 billion by the year 2000. A full 70% of that revenue will come from the services market. Conversely, almost 90% of the ATM revenue will come from equipment, an indication that ATM is still primarily a technology that carriers deploy in their backbone networks.
"There are very few multimedia applications that are mission critical yet," says Thomas Loane, VP and CIO at Alamo Rent a Car Inc. in Fort Lauderdale, Fla. "We haven't found any reason to go to ATM yet."
Vertical predicts that the worldwide ATM services an d equipment market will grow at a compound annual growth rate of 57%, from $1.2 billion in 1996 to $7.3 billion in the year 2000.

Back to News in Review
Send Us Your Feedback
Top of the Page