Virtual Router Market - Global Industry Analysis, Size, Share, Growth, Trends, and Forecast 2017 - 2025


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Virtual routers refer to a routing framework, based on software, which acts a normal hardware router. When virtual router software is installed in a device, such as a laptop or a server, it utilizes the hardware of the host to perform the network and packet routing functionalities, performed by a general router. Each virtual router is identified through a unique virtual router identifier, which is present at the last byte of the address. To improve the reliability of the network, virtual routers may be implemented by the Virtual Router Redundancy Protocol (VRRP). The VRRP functions to automatically assign to a participating host, any available Internet Protocol (IP) router. Virtual routers thus enables virtual routing, a form of Network Functions Virtualization (NFV). Virtual routing instances are independent in nature and hence allows for overlapping of IP addresses, without any conflict with each other. Virtual routers are software which can be run on commercial off-the shelf (COTS) hardware and enable the hardware to function like a general hardware based network appliance. Virtual routing enables the free relocation of routing functions across a network, since IP routing function is liberated from any specific software. In case of basic routing functions, addition of virtual router software to a commodity server allows the server to function as a router. In complex and advanced distributed routing environments, parts of the virtual router can be moved across the whole network, while being controlled from a centralized control location. From such an evolution it can be inferred that routing functions can be dynamically configured or adapted to the network needs. Open source emerging technologies are being designed to enable the routing functionalities to be integrated into software solutions and thus allowing for distribution throughout the network.

The market for virtual routers is primarily being driven by the growing popularity for software defined networking (SDN) and NFV globally. Such growth in NFV and SDN popularity has led to development of several advanced virtual router software solutions. These solutions allow for encapsulation of traffic through IP based tunnels and thus utilize an ‘overlay’ approach. Also several virtual routers have penetrated the market, which has Wide Area Networking (WAN) applications. Also, these advanced virtual router solutions can be installed in industry standard hardware, allowing for wider applications. Such features have been promoting the applications of virtual routers globally, leading to growth of the market across the globe. Additionally, application of virtual router leads to higher cost saving since dedicated hardware solutions are not required to be installed for routing purposes. This factor has also been positively impacting the demand for virtual routers globally. Furthermore, the growing demand for virtual routers as a replacement for WAN based routers has also been promoting the global market for virtual routers. However, the fact that virtual routers are unable to perform the functions of a heavy duty core IP router has been restraining the growth of the market to some extent. Considering the growing demand for virtual networks across different end use verticals, coupled with the growing advancements of virtual router software, the market for virtual routers can be expected to be provided with several growth opportunities, during the forecast period.

The global virtual router market has been segmented, on the basis of implementation into simple implementation, full implementation and others. Full implementation was the largest segment in 2016, owing to the advantages offered by this form of implementation and the higher cost of this type. On the basis of regions, the market for virtual routers has been segmented into North America, Europe, Asia Pacific (APAC), South America and Middle-East & Africa (MEA). North America held the largest market share in 2016, owing to the presence of large number of virtual router vendors.

The major companies of the virtual router market globally are Nokia Corporation [Owners of Alcatel-Lucent] (Finland), Cisco Systems (The U.S.), Brocade Communication Systems (The U.S.), Huawei Technologies Co., Ltd. (China), and Juniper Networks (The U.S.) among various other companies.

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