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Worldwide Optical Spending Stable, Slow Growth Expected
December 3, 2003
By OpticallyNetworked Staff
Worldwide optical network hardware revenue hit $2 billion in the third quarter, down 3 percent from the previous quarter, according to a report by Infonetics Research.
In its quarterly Optical Network Hardware report, Infonetics predicts that after a decline in 2003, modest growth is projected through 2006, when the market will top $10 billion.
"The optical hardware market is stabilizing," said Michael Howard,
principal analyst and co-founder of Infonetics Research. "The telecom service
provider capex declines are finished or nearly finished, and they will
maintain a flat-to-slow-growth in the future."
Infonetics predicts that optical equipment
spending worldwide will be relatively stable from 2003 through 2006. In
North America, spending leveled out during 2003 and will start to slowinig grow in 2004 to
2005.
In its report, Infonetics list the following third quarter highlights:
Alcatel maintains its number-one spot in worldwide revenue market share
(intelligent plus legacy) with 14 percent, followed by the same three market
share challengers from the previous quarter, Huawei, Lucent, and
Nortel, each with 11 percent
Intelligent optical network hardware makes up 82 percent of all optical
network hardware revenue, while legacy continues its decline at 18 percent. The
legacy will decline to about 3 percent in 2006
Metro networks, which makes up 70 percent of all optical network hardware revenue, will remain the focus in general for some time in all regions; metro
Metro Wavelength Division Multiplexing (WDM) continues its growth, up from the second quarter to a total of $243.7
million, with Dense Wavelength Division Multiplexing (DWDM) up 5 percent. The burgeoning but smaller Coarse Wavelength Division Multiplexing (CWDM) market
was up 19 percent, according to Infonetics.
Metro SONET /SDH makes up the lion's share (56 percent or $1.1 billion) of
total optical equipment sales, led by Alcatel (16 percent) and Fujitsu (14 percent)
The regional breakdown is as follows: 33 percent Asia Pacific, 31 percent North America, 30 percent EMEA, and
7 percent from Central America/Latin America. Inonetics describes the Asia Pacific market as having "many buildouts," the market in China as "slowed," and
India as "picking up."