Sales of service provider and enterprise telecom and datacom equipment hit $139 billion worldwide in 2007, up 13% from 2006, and are forecast to grow 26% to $174 billion in 2011, says a new report from communications market research firm Infonetics Research.

According to the report, Service Provider and Enterprise Telecom and Datacom Equipment, the 5-year compound annual growth rates (CAGRs) for all segments tracked in the report range from slightly negative to strong double digits from 2007 to 2011, with IPTV and IP video equipment growing the fastest, followed by service provider VoIP and IMS equipment.

While service provider wireless and FMC equipment and enterprise routers, switches, and wireless LAN equipment make up the largest portions of revenue, the increases we're seeing in the overall telecom and datacom equipment market are being fueled by the transformation to IP packet networks, as evidenced by strong growth in the IPTV and service provider VoIP and IMS segments.

Other highlights from the report:

• The largest equipment category, service provider wireless and FMC, will decrease its share of overall telecom/datacom revenue by 4 points between 2007 and 2011, as fast growing segments like IPTV and carrier VoIP and IMS gain share
• About 1/3 of all 2007 telecom/datacom equipment revenue came from the Europe/Middle East/Africa (EMEA) region
• China and India will drive a significant jump in carrier capital expenditures, or capex, in 2008 as a result of network construction projects combined with currency appreciation against the US dollar
• Cisco leads the overall worldwide telecom/datacom network equipment market in 2007, followed by Alcatel-Lucent and Ericsson
• Ericsson and Alcatel-Lucent are neck and neck as leaders of the service provider telecom/datacom equipment segment, while Cisco leads the enterprise segment with nearly half of worldwide revenue market share in 2007