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Spend on enterprise network equipment to grow in 2012

Spending on enterprise network equipment will grow by 8.7% in 2012, as companies continue to turn to enterprise mobility, video consumption and cloud infrastructure, IDC predicts.

The additional factor of many companies’ five-year refresh cycles for network equipment purchases and upgrades coming to an end, means worldwide enterprise network revenues will reach $39.4 billion by the end of the year, IDC anticipates.

“When you think about planning for 2012, certainly cloud, mobility and video will drive the market,” said Cindy Borovick, research VP for IDC’s Enterprise Communications and Datacenter Network services.

IDC adds that the continued growth of smartphones has led to mobility on the network.

“As we saw last year in 2011, mobility clearly made a lot of waves, raised a lot of flags in terms of the best ways to contain handheld growth from a technology perspective and from a business perspective, while empowering users with the devices of their choice,” said Rohit Mehra, IDC’s director of Enterprise Communications Infrastructure.

Video consumption in the enterprise will also grow as a result of consumer activity on enterprise networks, IDC predicts. In 2011, an estimated 590 million people watched streamed video over the Web. With more employees connected to social media and entertainment sites more often, the amount of video content employees access on the company network is set to rise.

When combined with enterprise use of video, which will range from digital marketing initiatives to the growing trend in videoconferencing, video will be the main driver for enterprise network upgrades in 2012, IDC says.

A change in the way businesses approach the cloud will lead to a large increase in network equipment spending. IDC predicts in 2012 the enterprise migration to the cloud will become so dynamic that businesses will reach a breaking point and invest in the WAN to prepare for widespread cloud deployment.

“It’s really about moving away from the current piecemeal approach to bringing the WAN into the era of the cloud, and bringing a level of simplicity to the network architecture so it’s easier to manage,” Borovick said.

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