HP, with 3Com, Becomes No. 2 Ethernet Vendor

Thanks to its purchase of 3Com, HP is the world's second-largest Ethernet port vendor in the rapidly consolidating networking space, behind Cisco but just ahead of D-Link.

Hewlett-Packard is now the second-largest Ethernet port vendor, thanks to its $2.7 billion acquisition earlier this year of 3Com.

According to market research firm In-Stat, HP in the second quarter jumped over D-Link to grab the second-place spot behind Cisco Systems in total Ethernet port shipments.

In the report released Oct. 14, In-Stat analysts said that Cisco had 36 percent of the market, followed by HP at 20 percent, D-Link at 19 percent and Netgear at 8 percent.

Coming in at 6 percent was Cisco Small Business.

HP grabbed 3Com in another move by a major vendor looking to bulk up its data center offerings. For HP, the 3Com acquisition complements its ProCurve networking business, and brings it into tighter competition with Cisco.

HP and Cisco, once close partners, are competing in the burgeoning converged data center space. Cisco made its play last year with the introduction of its UCS (Unified Computing System), which integrates networking and server technology from Cisco with storage, virtualization and management software from such partners as EMC and VMware.

HP also is looking to expand its data center offerings, and Oracle also is making its push through the $7.4 billion purchase of Sun Microsystems. IBM, Dell and others also are offering converged data center offerings through in-house technology and outside partnerships.

"While it is still too early to tell if synergies between HP and 3Com will result in a stronger competitor to Cisco, it is definitely a noteworthy contender to watch closely," In-Stat analysts said in a statement.

The numbers from In-Stat also are indicative of the consolidation going on in the industry. Combined, the top four vendors ship 83 percent of the Ethernet ports worldwide-89 percent if Cisco Small Business is factored in.

In addition, some areas saw growth in both shipments and revenue. Fixed 10 Gigabit Ethernet ports saw a 21.1 percent jump in shipments and 6.6 percent growth in revenue. In addition, PoE (Power over Ethernet) revenues grew to 18.3 percent of all Ethernet switch revenues, according to In-Stat.

However, shipments of 10GbE fell 5.3 percent, though revenues rose 2.5 percent, thanks to a jump in Layer 3 port shipments. Shipments of total fixed ports rose 3.7 percent, through revenues fell .7 percent.