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Optical network equipment up 8% in 4Q11 as big vendors surge

Market research firm Infonetics Research today reported in its Optical Network Hardware vendor market share report that spending on optical gear grew 8% globally in the fourth quarter of 2011 (4Q11) over the previous quarter.

ANALYST NOTE

"Regional spending trends for optical network hardware were volatile in the final quarter of 2011, with North America down and the rest of the regions up sequentially, including a huge 63% gain in Latin America -- a region showing very positive long-term trends," notes Andrew Schmitt, directing analyst for optical for Infonetics Research.

Schmitt continues: "While the typical end-of-year budget flush failed to materialize in North America with AT&T and Verizon spending less, it did appear in full effect in EMEA, particularly Europe, up almost 11%. But the surge in Europe was due mainly to a surge in legacy SDH spending rather than of new WDM gear. Rising legacy spending is a negative leading indicator, as is the reversal in EMEA's rolling four-quarter revenue, which turned negative in 4Q11 after only two quarters of gains."

OPTICAL HARDWARE MARKET HIGHLIGHTS

    The global optical network equipment market, including WDM and SONET/SDH equipment, grew 8% sequentially in 4Q11, from $3.4 billion to $3.6 billion
    For the full year 2011, the overall optical network hardware market is up 9%
    In 4Q11, the largest optical vendors benefitted most -- with the exception of Cisco – including Huawei (up 35%), Alcatel-Lucent (up 20%), and Ciena (up 10%)
    Notably, both Ciena and Infinera bucked the North America down-trend with positive quarterly optical revenue
    In 2011, WDM optical spending grew 22% while SONET/SDH spending shrank 6%, as carriers continued to abandon investments in legacy technology in favor of ROADMs, coherent optics, packet-optical transport, and optical transport network (OTN) equipment
    ROADM spending is on a 7-quarter streak of consecutive gains, with shipments up a stunning 36% in 2011 over 2010


REPORT SYNOPSIS

Infonetics’ quarterly Optical Network Hardware report tracks Adtran, ADVA, Alcatel-Lucent, BTI, Ciena, Cisco, ECI, Ericsson, Fujitsu, Huawei, Infinera, NEC, Nokia Siemens Networks, Nortel, Sycamore, Tellabs, Transmode, Tyco, ZTE, and others. The report provides worldwide and regional vendor market share, market size, and analysis (forecasts published Feb. 24). Equipment tracked: metro and long haul SONET/SDH and WDM optical network equipment (transport, ROADM, submarine line terminating equipment), and ports (Ethernet, SONET/SDH/POS, and WDM).

Huawei Cuts OEM Deals Worth $6B

Huawei, the world’s leading information and communications technology (ICT) solutions provider, today announced that it will award Original Equipment Manufacturer (OEM) contracts totaling US$6 billion to Qualcomm, Broadcom and Avago, three California-based leading communications technology companies. Today’s announcement underscores Huawei’s continued commitment to the U.S. market and the three-year OEM contracts will directly and indirectly create over tens of thousands of job opportunities for U.S. business while contributing to growth and development opportunities for California high-tech as well as the ICT industry as a whole.

“This procurement agreement reaffirms Huawei’s determination to deliver on its promise to be a local economy contributor, and is a demonstration of confidence in the long-term relationships we have cultivated with our local high-tech partners,” said Ms. Chen Lifang, Senior Corporate Vice President of Huawei, “The U.S. holds the leading position in the ICT industry, and when coupled with Huawei’s long-term dedication to innovation in the U.S. market, the result is a strategic collaboration to develop a more diversified, balanced and healthier global ICT ecosystem.”

Huawei Technologies Co. Ltd.

Colt Uses ADVA FSP 3000

ADVA Optical Networking announced today that Colt, the information delivery platform for European business, has selected the FSP 3000 as the foundation of its new ROADM-based network in Dublin, Ireland. The infrastructure enables incremental bandwidth to be added on demand with fast provisioning through the FSP Service Manager. The eleven-node, ring-based network spanning 100km is capable of flexible service routing that reduces operational costs, planning time and lead times when deploying new services.

Colt’s enterprise and carrier customers will benefit from the flexibility that ROADM networks enable that will allow Colt to use a combination of hardware pre-provisioning and point-and-click configuration software to improve its customer’s service delivery experience. This will give Colt a unique ability to deliver exceptional lead times for high bandwidth services for data centers, financial institutions and business campus locations around Dublin.

“The multi-degree ROADM architecture provides us with a flexible provisioning option, allowing us to easily provide access at nodes as demand grows with point-and-click technology, giving us a competitive advantage to attract customers through reduced lead times” said Ken Sherry, operations director for Colt in Ireland. “This will save valuable time and resources in network planning and service provisioning, making us more efficient and agile than ever before,” he added.

“Scalability is a key component in today’s networks as increasing amounts of data are being transported,” commented Marcello Forti, vice president, U.K. & Ireland Sales, ADVA Optical Networking. “Service providers like Colt need the ability to quickly provision services and respond to customers. Fast provisioning through the FSP Service Manager saves time and resources, giving Colt an advantage in a competitive environment. Business customers benefit greatly by having bandwidth when and where they need it. That is what modern networking is all about.”

The FSP 3000 is a scalable Wavelength Division Multiplexing (WDM) system specifically designed for large enterprises and service providers that require a flexible, cost-effective system that will multiplex, transport and protect high-speed data, storage, voice and video applications over fiber optic networks.

PacketFront Unveils ASR6000 at FTTH 2012

This latest generation of the ASR product line provides full service-flexibility for the network edge. Using a hybrid ASIC and Network Processor design, the ASR6000 delivers superior functionality for controlling bandwidth consumption and traffic quality of services in the access layer. The ASR6000 has innovative features that reduce the operational costs for running broadband networks, as well as improving the quality of the delivered services. With support for both 100Mbit/s and 1Gbit/s speeds over copper and fiber access ports, moving into the world of Gigabit broadband networking has never been easier. The ASR6000 provides full wirespeed IPv4 and IPv6 routing and switching.

“The two main challenges facing broadband operators today are consumers’ increasing demands for bandwidth and the need for a secure IPv6 Internet access. The ASR6000 delivers both of these”, says Fredrik Nyman, Access Product Manager at PacketFront. “IPv6 security is at the top of the agenda for many broadband networks. The ASR6000 native dual-stack deployment makes it possible to proceed without this issue becoming an obstacle.”

The new, script-based service control framework means that each ASR6000 can independently use RADIUS or DHCP servers to authenticate and to supply services to end-user clients. This creates a very cost-effective solution for service control and network management. The ASR6000 also contains features to simplify network operations. For example, remote packet capture and quality inspection of TV broadcasts make it possible to analyze each customer’s experience of network services and thereby shorten troubleshooting time. Furthermore, the ASR6000 provides superior queuing and scheduling with thousands of virtual queues, true ingress- and egress traffic shaping, and fair queuing to ensure the best possible customer experience when using the Internet.

PacketFront AB

Infonetics: OTN transport and switching equipment a $10.6 billion market by 2015

Carriers are installing Optical Transport Network (OTN) transport equipment first, but OTN switch deployment should catch up fast, says Infonetics Research. Combined, the two segments will create a $10.6 billion market by 2015 according to OTN Hardware Market Outlook, which the market research firm asserts is the first report to track, segment, and assess vendor market share for both OTN transport equipment and OTN switching equipment.

Infonetics says that 92% of OTN spending went to transport equipment in 2011. However, the OTN switching segment is growing much faster than OTN transport, a phenomenon that will continue as carriers roll out 40-Gbps and 100-Gbps coherent technology, according to the report.

"Each segment is in a different stage of adoption and has a wildly different growth rate,” confirms Andrew Schmitt, directing analyst for optical at Infonetics Research. “Case in point: OTN switching revenue jumped 132% in 2010 over 2009, while OTN transport revenue grew 9%. Both segments are growing at a pace that far outstrips the 3.7% CAGR of the overall optical market."

For example, OTN switching and transport system sales combined to make up 45% of global optical equipment spending (including WDM and SDH/SONET) in the first half of 2011. That share should increase to 70% of the total by 2015, the report asserts.

Huawei currently rules both the OTN transport and switching markets, thanks in part to the fact that China's telecom carriers were the first to embrace all-OTN networks, including the largest installations of OTN switching.

Infonetics' OTN hardware report provides regional and global market size, forecasts, vendor market share, and analysis for OTN transport hardware and OTN switching hardware, including OTN port revenue forecasts by port type and speed. The report includes OTN hardware market drivers, regional OTN trends, OTN vendor market share notes, OTN service provider survey data, and comparison's to the overall optical network hardware market.

by Lightwave Staff
February 14, 2012

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