Infonetics: Optical hardware market declines in 1Q11, but growth still forecasted

Despite what it called a typical seasonal decline of 12% quarter on quarter in the first three months of this year, market research firm Infonetics Research says that it stands by its previous forecast of single-digit growth in 2011.

Despite what it called a typical seasonal decline of 12% quarter on quarter in the first three months of this year, market research firm Infonetics Research says that it stands by its previous forecast of single-digit growth in 2011.

The market numbers are contained in Infonetics Research’s first quarter 2011 Optical Network Hardware vendor market share report. The quarterly Optical Network Hardware report tracks worldwide and regional vendor market share, and market size. It provides data on metro and long haul optical network equipment, including SONET/SDH (ADMs and terminals, metro MSPPs and crossconnects), WDM (transport, ROADM, and long haul submarine line terminating equipment), and packet-optical transport systems (P-OTS).

"There is concern in the optical industry about the outlook for 2011, but we feel our single digit growth forecasts for 2011 are achievable,” assured Andrew Schmitt, Infonetics Research's directing analyst for optical. “Optical equipment for mobile and broadband backhaul is in demand, and carriers are embarking on a multi-year 'optical reboot' to 40-Gbps/100-Gbps transmission over OTN and ROADM based networks. Vendors who service the growing WDM and packet-optical sector should do well, while vendors leveraged to legacy SONET/SDH will not."

Year-over-year, from the first quarter of 2010 to the first quarter of 2011, WDM optical network equipment spending is up 20% and the overall optical market is up 7%.

Other data in the report includes:

  • Optical network hardware vendors that are Japan- and North America-centric did well in 1Q11, including Ciena, Cisco, Fujitsu, and NEC, all posting single- or double-digit gains.
  • Most other vendors posted slight to significant revenue declines, including market leaders Alcatel-Lucent and Huawei
  • North America optical spending held steady in 1Q11 over 4Q10, bucking normal seasonal trends
  • Optical equipment spending is up year-over-year in all regions except Asia Pacific
  • ROADM spending set another new high in 1Q11, shrugging off seasonal spending patterns to rise 4% sequentially.

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