A new Vertical Systems reports shows an ever-more-competitive Ethernet marketplace, as AT&T lost ground and Cox Communications became the first cable company in the top four U.S. Ethernet providers.

Also gaining market share were Verizon Business, Time Warner Telecom and Cogent, the No. 2, 3 and 5 Ethernet service providers in the U.S., respectively. Those losing ground besides AT&T included Qwest and Yipes!

AT&T continues to hold the top spot with a 19.5% market share at mid-2007, measured in terms of Ethernet ports. That’s down from the combined AT&T (13.6%) and BellSouth (8.5%) shares at the end of 2006. Verizon is up to 15.8%, from 12.2% while Time Warner Telecom jump from 10.7% to 13.7%.

Cox became the first cable player in the top tier of U.S. Business Ethernet providers with port share of 8.9%, followed by Cogent at 8.6%, up from 8.2%; Qwest with 8.4%, down from 9.9% and Yipes in seventh at 4.6%, down from 5.4%.

Rick Malone, principal at Vertical Systems, said the volatility of the market stemmed from how competitive it has become.

“As anticipated, competition in the business Ethernet services market heated up during the first half of 2007, resulting in considerable port share fluctuation,” he said in a prepared statement. “The dense availability of low cost metro services boosted share for many regional U.S. Ethernet providers, including MSOs. Additionally, the aggressive deployment of new fiber infrastructure for residential applications enabled broader accessibility of native Ethernet services for adjacent business sites.”