Sunday, December 6, 2009

Infonetics: North American Optical Market Continues Rebound, Asia Slows

Following a 7% increase in 2Q09, worldwide optical network hardware revenue decreased 2.5% in 3Q09, to $3.3 billion, according to a new report from Infonetics Research. The North American market grew 4%, while Asia, EMEA, and Central and Latin America were all down.

"While the overall optical network hardware market dipped in the third quarter, led by slight declines by heavy hitters Huawei and Alcatel-Lucent, the North American market inched up again, a trend we expect to continue. The other major regions were down this quarter, although we expect a strong fourth quarter across the board. Asia is at risk for a liquidity-related 'Black Swan' event if the loose lending comes to an end, but the region is on track to overtake all others as the largest optical network hardware market in 2009 and well into the future, albeit at a slowing growth rate," forecasts Andrew Schmitt, directing analyst for optical at Infonetics Research.

Some additional highlights of the report:

  • Next generation WDM optical equipment revenue grew 7% sequentially in 3Q09, indicating that telecom carriers are allocating more money toward forward-looking infrastructure plans

  • Alcatel-Lucent continues to lead the long haul optical market, although Huawei has increased its revenue market share by 80% over the last two years, while ALU has dropped a point

  • Infinera passed Ericsson and Nortel in long haul optical network equipment revenue in 3Q09

  • 40G port shipments were down sharply

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  • Packet optical transport system (P-OTS) deployments are ramping rapidly in North America, and Fujitsu, Tellabs, Cisco, and Alcatel-Lucent are seeing excellent growth

  • The battle between P-OTS and IP over WDM technology will be an interesting one to watch.

See also