Virtual Router Market Forecasts to 2028 - Global Analysis By Type (Custom and Predefined), Component (Solution and Service), End User and By Geography

According to Stratistics MRC, the Global Virtual Router Market is accounted for $246.36 million in 2022 and is expected to reach $861.46 million by 2028 growing at a CAGR of 23.2% during the forecast period. Virtual routers are the software routers that provide network communication services for customers. It is a cloud-based router installed on VM instances of physical servers in order to provide routing, switching, security, VPN and other tasks through a virtualization platform. Multiple routing instances are made possible by a technique found in Internet Protocol (IP) network routers. By handling network and packet routing, it may provide a computer or server the capabilities of a fully working router. It enables flexibility and the capacity to elastically grow resources by adding cores.

Market Dynamics:

Driver:

Reduction in expenses

Enterprises generally concentrate on lowering the cost associated with hardware maintenance because it is an additional expense. Organizations may significantly lower the cost of maintaining dedicated routers owing to the growing use of the virtualization environment. By implementing virtual routers, internet and cloud service providers may concentrate on lowering the cost associated with making major hardware investments, since virtual routers can be chosen and implemented using the as-pay-you-grow approach. As a result, virtual routers can assist service providers in maximizing the advantages provided by virtualization technology.

Restraint:

Unease in moving from the legacy system

One of the reasons limiting the market for virtual routers may be the hesitation to switch from a legacy system to a virtualized environment. Many service providers, including telecom and Internet service providers (ISPs), still run and maintain outdated systems, which are difficult to administer. The maintenance costs and platform incompatibility of older systems provide a number of difficulties. Thus there is always a risk that these solutions won't be fully integrated.

Opportunity:

Demand for private cloud

Businesses are turning toward the private cloud to take benefit of the merits such as security, privacy, efficiency and customisation. Organizations may manage their networks more efficiently while spending less money on administration of the virtual router infrastructure by using virtual routers through the private cloud. Additionally, the private cloud provides a practical method for deploying virtual routers, assisting IT staff in efficiently managing an organization's complete network.

Threat:

Lack of knowledge and experience

Lack of knowledge and experience is the main obstacle of virtual routers market. It is becoming increasingly important to have engineers who can develop virtualized router software solutions in next-generation networks and data centers. Small and Medium-sized Enterprises (SMEs) may need to engage workers on a contract basis in order to implement solutions in a virtualized environment. Any mistake in the implementation and integration of these solutions might have a negative effect on the network infrastructure, which would then have an effect on revenue and customer satisfaction.

COVID-19 Impact:

Most industries faced difficulties during the COVID-19 epidemic. Governments forced indefinite shutdown has prompted organizations to adopt a new workplace culture. Organizations attempted network environments to reduce maintenance costs across all organizations. Even in worse situation, it offered greater dependability and functionality. As a result, this new circumstance has given the market a boost.

The service providers segment is expected to be the largest during the forecast period

The service providers segment is estimated to have a lucrative growth, due to growing deployment of virtual network functions. Future carrier network domains are anticipated to be dominated by the architecture of virtual network services. For the majority of carriers and telcos, recognizing the change toward a software-defined, virtualized infrastructure is just getting started. The segment's growth is being driven by new revenue sources and increased operational effectiveness.

The custom segment is expected to have the highest CAGR during the forecast period

The custom segment is anticipated to witness the fastest CAGR growth during the forecast period, due to its mobility and efficiency. Custom virtual router enables creating and configuring additional virtual routers within the single routing device as per requirement. It increases the need of mobility and network function virtualization. Custom virtual routers improve network agility and reduce the capital & operating expenditure of the organizations. These benefits are fuelling the segment's demand.

Region with largest share:

North America is projected to hold the largest market share during the forecast period owing to the growth in Research and Development (R&D) and advancements in the networking technology. The region is facing huge network infrastructure complexities. Service providers are increasingly using virtual router solutions to improve their networks. This region is having the presence of key companies namely IBM Corporation and Cisco Networks.

Region with highest CAGR:

Asia Pacific is projected to have the highest CAGR over the forecast period, owing to the existence of numerous small and medium-sized businesses. The rapid development of software defined networking (SDN) and network function virtualization (NVF) are expanding the market in countries like India, China, and Japan. Small and medium-sized businesses manage enormous amounts of data which is the major factor of market expansion in this region.

Key players in the market:

Some of the key players profiled in the Virtual Router Market include: Cisco Systems Inc, Huawei Technologies Co Ltd, Nokia, IBM Corporation, Hewlett Packard Enterprise Development LP, Juniper Networks Inc, Arista Networks Inc, Palo Alto Networks, ZTE Corporation, 6WIND, ROSS VIDEO LTD, 128 Technology, TRENDnet, Allied Telesis, Check Point Software Technologies Ltd, Belkin International Inc, Broadcom Inc, Lanner Electronics, Ericsson Inc and LINKSYS.

Key Developments:

In March 2023, Cisco announced 800G innovations that continue to transform the economics and sustainability of the Internet for the Future, to help its customers connect the nearly 40% of the world's population. Using Cisco 8000 Series Routers with the new line card, service providers and cloud providers can realize up to 83% space savings and up to 68% power savings migrating from 400G to 800G for IP backbone, metro core, and data centers supporting AI/ML workloads.

In July 2022, Lanner Electronics, a leading uCPE Whitebox Solutions™ provider announced that the company has established a partnership with 6WIND, a high-performance networking software company, to provide a full range of whitebox uCPE solutions pre-validated with 6WIND's Virtual Service Router (VSR) solutions, offering scalable virtualized routing and security at the edge.

In January 2021, Linksys, the connected home division within Belkin International introduced its latest advancements in Wi-Fi and motion detection technology with the Linksys AXE8400 Wi-Fi 6E System and Linksys Aware. Linksys AXE8400 reduces congested, unsteady Wi-Fi connections and delivers more bandwidth to consumers' homes for clearer, faster networks and strengthened reliability. It has built-in mesh technology and easy app-based setup.

Types Covered:

• Custom
• Predefined

Components Covered:

• Solution
• Service

End Users Covered:

• Enterprises
• Service Providers

Regions Covered:

• North America
  • US
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • Italy
  • France
  • Spain
  • Rest of Europe
• Asia Pacific
  • Japan
  • China
  • India
  • Australia
  • New Zealand
  • South Korea
  • Rest of Asia Pacific
• South America
  • Argentina
  • Brazil
  • Chile
  • Rest of South America
• Middle East & Africa
  • Saudi Arabia
  • UAE
  • Qatar
  • South Africa
  • Rest of Middle East & Africa

What our report offers:

• Market share assessments for the regional and country-level segments
• Strategic recommendations for the new entrants
• Covers Market data for the years 2020, 2021, 2022, 2025, and 2028
• Market Trends (Drivers, Constraints, Opportunities, Threats, Challenges, Investment Opportunities, and recommendations)
• Strategic recommendations in key business segments based on the market estimations
• Competitive landscaping mapping the key common trends
• Company profiling with detailed strategies, financials, and recent developments
• Supply chain trends mapping the latest technological advancements

Free Customization Offerings:

All the customers of this report will be entitled to receive one of the following free customization options:

• Company Profiling
  • Comprehensive profiling of additional market players (up to 3)
  • SWOT Analysis of key players (up to 3)
• Regional Segmentation
  • Market estimations, Forecasts and CAGR of any prominent country as per the client's interest (Note: Depends on feasibility check)
• Competitive Benchmarking
  • Benchmarking of key players based on product portfolio, geographical presence, and strategic alliances