The Data Center AI Networking market is expected to grow to over $3 billion in 2023, according to a newly release report by 650 Group, which also reveals that sales of both Infiniband and Ethernet for AI networking applications achieved record levels in 1Q23.
The report indicates that the top two vendors are Arista and NVIDIA. White box switch presence in AI/ML data centers is not as high as the overall market penetration. In addition, the report highlights the difference between Infiniband and Ethernet in vendor shares and market forecasts.
Highlights for 1Q23 include:
- Arista and NVIDIA are the largest two vendors in this segment
- By 2027, nearly 1 in 5 Ethernet Switch ports sold into the data center will be related to AI/ML and accelerated computing.
- AI/ML will drive record levels of 800 Gbps ports and Optics during the first 18 months of adoption.
- Hyperscaler CAPEX for 2023 will remain robust for AI/ML projects as traditional deployments show weakness in 2023
- Customers continue to evaluate different networking topologies to address AI/ML networking requirements.
“The first half of 2023 has shown tremendous growth in vendor revenue related to AI/ML networking with 2H 2023 and 2024 set to surge as many customers’ proof of concepts move towards production networks,” said Alan Weckel, Founder and Technology Analyst at 650 Group. “AI/ML puts a tremendous amount of bandwidth performance requirements on the network, and AI/ML is one of the major growth drivers for Data Center switching over the next five years. With bandwidth in AI growing, the portion of Ethernet switching attached to AI/ML and accelerated computing will migrate from a niche today to a significant portion of the market by 2027. We are about to see record shipments in 800Gbps based switches and optics as soon as products can reach scale in production to address AI/ML.”