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18 August 2006


Fibre Channel at 8Gbit/s to meet same problems as 10Gbit/s Ethernet

Most Fibre Channel switch and Host Bus Adapter sales will remain at 4Gbit/s speeds beyond 2010, predicts Dell'Oro Group¹s 5-Year Forecast Report. Sales of 1Gbit/s Fibre Channel dominated the market for about five years and
2Gbit/s for four years, but 4Gbit/s will dominate beyond five years, it reckons.

"In general, manufacturers invent and build higher-speed solutions that offer customers a price advantage on a per gigabit of bandwidth," said Tam Dell'Oro, founder and principal storage-area network analyst. "But we don't
see 8Gbit/s Fibre Channel being able to offer a price advantage over 4Gbit/s speeds in the next few years. In addition, we expect 8Gbit/s Fibre Channel will hit the same 15m distance limitation and laser jitter problems that
Ethernet has at 10Gbit/s speeds. Until 8Gbit/s Fibre Channel or 10Gbit/s Ethernet can offer a price advantage over 4Gbit/s, the latter will be the logical choice," concludes Dell'Oro.

* Nevertheless, following lacklustre results the prior quarter, the 10 Gigabit Ethernet Switch market grew substantially to $302m in Q2/2006, says Dell'Oro Group in its Ethernet Switch Quarterly Report. The modular - or
chassis - segment rebounded to drive most of the strong results.

"Not only did 10 Gigabit Ethernet port shipments increase dramatically during the quarter, but average selling prices also rose, resulting in extra strong revenue growth," said Seamus Crehan, senior director of Ethernet Switch Research. "Although prices did increase during the quarter, we expect the general trend of steep declines to resume as vendors introduce higher port density line cards and fixed configuration products," he added.

Visit: http://www.DellOro.com