Virtual Router Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

The global virtual router market is segmented by Component (Solution and Service), End User (Service Providers, Enterprises) and Geography.

Virtual Router Industry Overview

virtual router market
Study Period: 2018 - 2028
Fastest Growing Market: Asia Pacific
Largest Market: North America
CAGR: 23 %

Major Players


*Disclaimer: Major Players sorted in no particular order


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Virtual Router Market Analysis

The global virtual router market is expected to register a CAGR of over 23% during the forecast period (2021 - 2026). The virtual routers are witnessing an increase in demand in the telecommunication industry as it offers benefits such as the reduction in the total cost of ownership (TCO), scalability and, flexibility.

  • The increasing focus on software-defined networking (SDN) has led to the development of several advanced virtual router software solutions.
  • The increasing demand for private cloud and virtual router applications across network segments are expected to provide significant growth opportunities in the market.
  • The security concerns associated with the virtualized environment and inability of a virtual router to perform the functions of a heavy-duty core IP router is likely to hinder the market growth.

Virtual Router Industry Segments

A Virtual Router is a software function that replicates in software the functionality of a hardware-based Layer 3 Internet Protocol (IP) routing, which has traditionally used a dedicated hardware device. 

By Component
By End User
Service Provider
North America
United States
United Kingdom
Rest of Europe
Asia Pacific
Rest of Asia-Pacific
Rest of the World
Latin America
Middle-East & Africa

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Virtual Router Market Trends

This section covers the major market trends shaping the Virtual Router Market according to our research experts:

Service Providers to Hold Major Share

  • The service providers are expected to hold a major share due to the growing deployment of SDN and VNF.
  • The telecommunication service providers are being challenged to transform their carrier network infrastructure to build new business network services, generate new revenue streams, and improve their operational efficiency.
  • These providers globally recognized the need to digitally transform their network infrastructure and build more customer-centric business models. Embracing software-defined networking principles and the innovative deployment of network functions in virtualized form factors are a strategic necessity not only for carriers as they invest in their future but also for vendors supplying those solutions to the market. 
  • The architecture of virtual network functions is likely to pervade all carrier network domains in the future. Recognizing the shift toward a software-defined, virtualized infrastructure is just beginning for most carriers and Telcos.
virtual router market anlaysis

North America to Hold Major Share

The North America region is anticipated to hold major share owing to the growth in Research and Development (R&D) and advancements in the networking technology. The region is also witnessing increasing complexities in network infrastructure, growing adoption of virtual routers solutions by service providers in order to optimize their networks, and a growing demand to deliver an enhanced customer experience across all the major industry verticals. 

virtual router market trends

Virtual Router Market Competitor Analysis

The virtual routers market is gaining a competitive edge in recent years. The companies in the market are strategically innovating, partnering and expanding to provide communication solutions. 

  • January 2019: Cisco Systems announced intent to acquire Ensoft Ltd. to simplify service provider networks through automation and programmability. The acquisition of Ensoft Ltd. would accelerate the company's strategy and strengthen its commitment to its service provider customers.

Virtual Router Market Top Players

  1. Cisco Systems Inc.

  2. 128 Technology

  3. Brocade Communications Systems, Inc. (Broadcom Inc.)

  4. IBM Corporation

  5. Hewlett Packard Enterprise

*Disclaimer: Major Players sorted in no particular order

128 Technology, Brocade Communications Systems, Inc., Cisco Systems Inc., Ericsson Inc., Huawei Technologies Co., Ltd., Hewlett Packard Enterprise

Virtual Router Market Report - Table of Contents


    1. 1.1 Study Assumptions

    2. 1.2 Scope of the Study




    1. 4.1 Market Overview

    2. 4.2 Market Drivers

      1. 4.2.1 Growing Need to Improve Network Agility and Efficient Scale Out by Service Providers

      2. 4.2.2 Increase in the Demand for SDN and NFV

      3. 4.2.3 Demand of Reduction in Total Cost of Ownership (TCO)

    3. 4.3 Market Restraints

      1. 4.3.1 Security Concerns Associated with the Virtualized Environment

    4. 4.4 Industry Attractiveness - Porter's Five Force Analysis

      1. 4.4.1 Threat of New Entrants

      2. 4.4.2 Bargaining Power of Buyers/Consumers

      3. 4.4.3 Bargaining Power of Suppliers

      4. 4.4.4 Threat of Substitute Products

      5. 4.4.5 Intensity of Competitive Rivalry


    1. 5.1 By Component

      1. 5.1.1 Solution

      2. 5.1.2 Service

    2. 5.2 By End User

      1. 5.2.1 Service Provider

      2. 5.2.2 Enterprise

    3. 5.3 Geography

      1. 5.3.1 North America

        1. United States

        2. Canada

      2. 5.3.2 Europe

        1. United Kingdom

        2. Germany

        3. France

        4. Rest of Europe

      3. 5.3.3 Asia Pacific

        1. China

        2. Japan

        3. India

        4. Rest of Asia-Pacific

      4. 5.3.4 Rest of the World

        1. Latin America

        2. Middle-East & Africa


    1. 6.1 Company Profiles

      1. 6.1.1 128 Technology

      2. 6.1.2 Brocade Communications Systems, Inc. (Broadcom Inc.)

      3. 6.1.3 Cisco Systems Inc.

      4. 6.1.4 Ericsson Inc.

      5. 6.1.5 Huawei Technologies Co., Ltd.

      6. 6.1.6 Hewlett Packard Enterprise

      7. 6.1.7 International Business Machines Corporation (IBM)

      8. 6.1.8 Juniper Networks, Inc.

      9. 6.1.9 Nokia Corporation

      10. 6.1.10 Netronome Systems, Inc.

      11. 6.1.11 ZTE Corporation

    2. *List Not Exhaustive


**Subject to Availability
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Virtual Router Market Research FAQs

The Virtual Router Market is studied from 2018 - 2028.

The Virtual Router Market is growing at a CAGR of 23% over the next 5 years.

Asia Pacific is growing at the highest CAGR over 2018 - 2028.

North America holds highest share in 2021.

Cisco Systems Inc., 128 Technology, Brocade Communications Systems, Inc. (Broadcom Inc.), IBM Corporation, Hewlett Packard Enterprise are the major companies operating in Virtual Router Market.

Virtual Router Industry Reports

In-depth industry statistics and market share insights of the Virtual Router sector for 2020, 2021, and 2022. The Virtual Router research report provides a comprehensive outlook of the market size and an industry growth forecast for 2023 to 2028. Available to download is a free sample file of the Virtual Router report PDF.

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