22 August 2003 San Jose, CA Lightwave -- Worldwide optical network hardware revenue hit $2.15 billion in 2Q03, a 5% increase from 1Q03, according to Infonetics Research's quarterly worldwide market share and forecast service, Optical Network Hardware. The market research firm also predicts big things for CWDM in the future.
"This year will mark the bottom of the optical hardware market; starting in 2004, we'll see quarter-over-quarter increases through at least 2006," said Michael Howard, principal analyst and co-founder of Infonetics Research.
The market is forecasted to total $8.6 billion in 2003, a decline from 2002, but year-over-year growth is forecasted from 2004 through 2006, when the market will reach $10.8 billion.
"The economy is regaining strength in North America and in other regions, and carriers are starting to spend again," said Howard. "Consumer broadband and corporate traffic continues to grow, roughly doubling each year. Mobile telephony and mobile data (2.5G, 3G) traffic is growing, supporting continued single- to double-digit percentage annual increases in revenue for nearly all metro categories, and single-digit annual increases in long haul categories beginning in 2005."
Metro CWDM equipment, an emerging category tracked for the first time in this report, hit $26.7 million in 2Q03 and is forecasted to jump to $243 million in 2006. Metro CWDM is popular because it's a less expensive means to connect buildings to service providers, especially for storage and Gigabit Ethernet connections.
2Q03 optical hardware revenue highlights include:
- Alcatel leads in market share (intelligent and legacy) with 15%, followed by Nortel with 12%, and Fujitsu and Huawei tied at 9%.
- Metro makes up 65% of all optical network hardware revenue, driven by strong network traffic growth, and long haul makes up 35%; this 2:1 ratio will remain about the same for the next four years.
- Worldwide metro SONET/SDH is the king of the hill with 53% of total optical network hardware revenue, reaching $1.1 billion (slightly up compared to 1Q03).
- Worldwide passive optical network (PON) revenue hit $22.7 million, up 15% from 1Q03, and is forecasted to grow 102% to $45.8 million in 1Q04.
- Intelligent optical network hardware makes up 82% of all optical network hardware revenue, while legacy continues its decline at 18%.
- Asia-Pacific leads optical hardware revenue at 33%, then EMEA at 31%, North America at 29% (up 2% from 1Q03), and CALA at 7%.