The global virtual router market is expected to register a CAGR of over 23% during the forecast period (2020 - 2025). The virtual routers are witnessing an increase in demand in the telecommunication industry as it offers benefits such as the reduction in the total cost of ownership (TCO), scalability and, flexibility.
- The increasing focus on software-defined networking (SDN) has led to the development of several advanced virtual router software solutions.
- The increasing demand for private cloud and virtual router applications across network segments are expected to provide significant growth opportunities in the market.
- The security concerns associated with the virtualized environment and inability of a virtual router to perform the functions of a heavy-duty core IP router is likely to hinder the market growth.
Scope of the Report
A Virtual Router is a software function that replicates in software the functionality of a hardware-based Layer 3 Internet Protocol (IP) routing, which has traditionally used a dedicated hardware device.
Key Market Trends
Service Providers to Hold Major Share
- The service providers are expected to hold a major share due to the growing deployment of SDN and VNF.
- The telecommunication service providers are being challenged to transform their carrier network infrastructure to build new business network services, generate new revenue streams, and improve their operational efficiency.
- These providers globally recognized the need to digitally transform their network infrastructure and build more customer-centric business models. Embracing software-defined networking principles and the innovative deployment of network functions in virtualized form factors are a strategic necessity not only for carriers as they invest in their future but also for vendors supplying those solutions to the market.
- The architecture of virtual network functions is likely to pervade all carrier network domains in the future. Recognizing the shift toward a software-defined, virtualized infrastructure is just beginning for most carriers and Telcos.
North America to Hold Major Share
The North America region is anticipated to hold major share owing to the growth in Research and Development (R&D) and advancements in the networking technology. The region is also witnessing increasing complexities in network infrastructure, growing adoption of virtual routers solutions by service providers in order to optimize their networks, and a growing demand to deliver an enhanced customer experience across all the major industry verticals.
The virtual routers market is gaining a competitive edge in recent years. The companies in the market are strategically innovating, partnering and expanding to provide communication solutions.
- January 2019: Cisco Systems announced intent to acquire Ensoft Ltd. to simplify service provider networks through automation and programmability. The acquisition of Ensoft Ltd. would accelerate the company's strategy and strengthen its commitment to its service provider customers.
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