JUNE 27, 2008 -- According to LightCounting's (search for LightCounting) upcoming "Transceiver Sales Report," the total optical transceiver market declined by 2% in the first quarter of 2008. The main reason for this drop was due to a greater than 10% decline in the SONET/SDH segment, partly offset by sales of high-data-rate DWDM modules.

Despite the decline, the year-on-year increase was 15% in the first quarter, showing no sign of a slowdown in transceiver demand in LightCounting's view. Annually, transceiver sales increased 9% in 2007 to just under $2.1 Billion. Q1 2008 also set in motion a move toward positive growth margins for the optical transceiver industry, the research firm asserts.

Report highlights include:

• Sales of OC-768 modules grew by nearly 25% in Q1 2008.
  
• Shipments of 10-Gigabit Ethernet SFP+ transceivers surpassed all other 10-Gigabit Ethernet form factors for the first time in Q1 2008.
  
• Most vendors increased their profit margins in Q1 2008 considerably compared to Q1 2007, curtailing harmful price wars.
  
• Apart from growing sales of higher margin 40-Gbit/sec products, the industry consolidation got a boost in mid-2008.