John Mazur, principal analyst for Network Infrastructure - switching and routing at Ovum, said global service provider switching and routing spending is falling, and we haven't seen the bottom.
The market fell 20 percent in the first quarter of 2009 compared with the same period last year and is likely to continue.
Despite the drop, carriers continue to report robust IP traffic growth.
Cisco's recent Visual Networking Index predicted IP traffic will increase fivefold from 2008-13, with the largest growth segment being consumer internet usage.
"We attribute some of the recent router market decline to recession-induced postponement of strategic IP transformation projects, but service providers are also delaying short-term investment to shore up financial results," he said.
"There are no standards for carrier router loading, but service providers typically run networks at 40-50 percent utilisation."
They are comfortable that core routers can run without incident at 60-70 percent loading, but once average loading reaches 80 percent capacity upgrades are needed to ensure high availability, said Mazur.
The net result is a degraded quality of experience (QoE) for end users, be they man or machine. Forecasts for booming internet traffic growth rarely consider the impact of degraded service levels due to overburdened, packet-dropping core or edge routers.
"When is 'best effort' just not good enough?" Mazur asked.
"We don't believe service providers will allow serious service degradation to occur for their premium IP services.
"But we do believe public internet-based services are at risk of suffering from service degradation, with the result that end users' quality of experience may plummet."
ance is no guarantee of future results."
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