Next-Generation SONET/SDH equipment to net $7 billion by 2006

March 13, 2002--Manufacturers of SONET/SDH equipment suffered heavily in 2001, thanks to a sharp decrease of capital expenditures by telecommunications carriers and the demise of many Competitive Local Exchange Carriers (CLECs). Growth will be minimal in 2002, with the market finally regaining momentum in 2003 and beyond, claims a new report from In-Stat/MDR (Scottsdale, AZ).

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Th 87627

Manufacturers of SONET/SDH equipment suffered heavily in 2001, thanks to a sharp decrease of capital expenditures by telecommunications carriers and the demise of many Competitive Local Exchange Carriers (CLECs). Growth will be minimal in 2002, with the market finally regaining momentum in 2003 and beyond, claims a new report from In-Stat/MDR (Scottsdale, AZ).

In addition to established vendors like Lucent, Alcatel, Nortel Networks, and Marconi, a new group of manufacturers is jumping into the fray, says the report, all touting various next-generation embodiments of SONET/SDH targeted almost exclusively at the metro core and metro access levels of the optical network. Crowding in the space will definitely result in a shakeout, says Cunnigham.

"A wave of merger/acquisition activity will occur in coming months, as some of the established companies purchase new capabilities," he contends.

In-Stat/MDR also found that:

The SONET/SDH market will show slow growth from present levels through 2006 to reach $21.4 billion in 2006, of which approximately $7 billion will be next-generation SONET/SDH equipment.

Nortel, Lucent, and Fujitsu had the greatest market shares and revenues for SONET/SDH equipment in 2001.

Approximately a dozen major vendors comprise the bulk of the SONET/SDH marketplace today, most of whom have a well-established base in the long-haul market and have moved aggressively into the metro core. A handful of challengers are simultaneously moving up from metro access levels.

For more information about the report, "SONET/SDH: The Struggle Toward Recovery," visit In-Stat/MDR's Web site at www.instat.com.

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