Analyst: Don't challenge Cisco unless you're laser focused

Cisco's share of enterprise networking market actually rose in 2012, according to Synergy Research

Cisco's challengers have been dealt a blow by news that the networking overlord actually increased its market share in 2012.

According to analyst Synergy Research, Cisco accounted for more than one in every two dollars spent across the six main segments of the enterprise networking market in 2012.

Its share stood at 54 per cent - higher than 2011 - as it held its position in routing and switching while substantially raising its share of the voice systems segment.

Cisco's share price plunged in 2011 as chief executive John Chambers admitted the vendor had lost its way. But following several rounds of cost cutting and a divestment strategy that saw it sell off Linksys in January, networking's big daddy appears to be back on track and its share price hit a two-year high last month.

Synergy had Cisco leading all six segments, with its share varying from above 60 per cent for its core switching and routing technology - an area upon which Cisco has redoubled its focus in recent years - to a low of 27 per cent for UC applications.

But the market remains fragmented below that, Synergy noted, with HP the only challenger to finish second in two segments (Avaya, Microsoft, Ruckus and Polycom led the other four).

Synergy Research founder Jeremy Duke advised challengers not to attempt to be all things to all men.

"This is testament to the strength, breadth, strategy and execution of Cisco" Duke said. "But while Cisco's overall market share is holding steady, there are niche opportunities across the board. For vendors to successfully target those niches, they must be laser focused and cannot hope to take on Cisco across all product areas."

According to Synergy, the overall enterprise networking market shrank by two per cent in 2012 to $45bn (£30bn).