Data Traffic Driving ATM Equipment Growth

International Data Corp. (Framingham, Mass., www.idc.com) forecasts that the asynchronous transfer mode (ATM) access equipment market will grow to $919 million in 2002, at a compound annual growth rate of 53 percent.

The growth of available ATM services will spur this market boom as it will lead to an increased demand for ATM access equipment. "The majority of ATM access equipment revenues are through direct sales to carriers," says Ladan Mestchian, senior analyst with IDC's Data Communications Technology program. "We see this trend continuing in favor of the service provider market, largely because of the preference of customers to lease equipment from their service providers and the increased popularity of managed network services. Also, ATM will play a big role in the converged voice and data networks of the future, because it was inherently designed with that in mind -- to transfer both voice and data traffic with guaranteed quality of service measures."

According to IDC, the United States was responsible for 88 percent of ATM access equipment sales in 1997, with Europe accounting for 8 percent and the remainder coming from Asia/Pacific and the rest of the world. The U.S. share of this market will drop to 55 percent in 2002, as ATM starts to penetrate the international access market.

In 1997, the United States accounted for 88 percent of the ATM access equipment market. As the ATM device market grows to $919 million in 2002, the U.S. market share will drop to 55 percent.