Saturday, November 17, 2012

Infonetics: Optical Sales Slow in Q3 - SONET/SDH Declines Outpace WDM Gains

The global optical network hardware market, including WDM and SONET/SDH, fell 2% sequentially in Q3 2012, according to preliminary analysis from Infonetics.  This marks the third straight quarter of declines following 5 consecutive quarters of minor increases.

"Investment in new WDM gear is growing, but it isn't growing fast enough to offset the accelerated declines in SONET/SDH," notes Andrew Schmitt, principal analyst for optical at Infonetics Research. "SONET/SDH spending hit another all-time low in the third quarter, as architectural shifts in wireless backhaul quicken its transition into obsolescence. Carriers aren't allocating scarce capital to out-of-date equipment."

Some other highlights of the upcoming report:

  • SONET/SDH optical spending continued its sharp fall, down 19% sequentially and 33% year-over-year
  • NEC, Fujitsu, and Infinera had a strong 3Q12, with revenue up by double digits thanks to robust ROADM equipment spending
  • Alcatel-Lucent posted its lowest-ever optical revenue results in 3Q12, with the majority of the decline coming from its WDM business
  • Performance in North America and EMEA (Europe, the Middle East, Africa) was relatively weak, although North America is expected to resume moderate growth in 4Q12 as AT&T and Verizon ramp spending.

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