Infonetics: $186B spending on Carrier Ethernet over next 5 years

Following a massive 43% increase in 2010, the global Carrier Ethernet equipment market grew at 13.4% to reach $31.7 billion in 2011, according to the latest market report from Infonetics Research. The analyst firm expects Carrier Ethernet equipment revenue to grow at a more sedate pace over the next five years, reaching $42.4 billion in 2016.

The chief market drivers are service providers moving to IP packet-based next-generation networks (NGNs), which depend heavily on IP, MPLS, and Ethernet technologies, as well as growing traffic – particularly video traffic – from consumer, business, and mobile backhaul networks. Ethernet offers a less expensive way to interconnect telecom equipment, whether routers to routers, DSLAMs to routers, or routers to optical gear.

"Over the five years from 2012 to 2016, operators will spend a cumulative $186 billion worldwide on Carrier Ethernet equipment, outpacing overall telecom capex," said Michael Howard, principal analyst for carrier networks and co-founder of Infonetics Research. "Every major operator in the world, including BT, Belgacom, Swisscom, Telstra, FT-Orange, Verizon, AT&T, NTT, KDDI, China Mobile, and many others have explicit IP NGN transformation projects going, for which they will use plenty of Ethernet as they gradually replace their legacy SONET/SDH equipment."

Mobile backhaul continues to be a particular Carrier Ethernet growth area, with IP/Ethernet equipment making up 93% of all mobile backhaul equipment spending in 2011 (see "Infonetics: China boosted 2011 mobile backhaul equipment market").

The largest Carrier Ethernet equipment segments by carrier spending are IP routers, Carrier Ethernet switches (CES), and optical gear. Ethernet-only microwave is the fastest growing Carrier Ethernet market segment thanks to its use in mobile backhaul.

Infonetics says its annual Carrier Ethernet Equipment market report measures use, penetration of, and investment in, carrier Ethernet products in service provider networks. The report also provides worldwide and regional market size, analysis, and forecasts for all carrier Ethernet equipment in service provider networks, including carrier Ethernet switches, IP core routers, IP edge routers, SONET/SDH Ethernet equipment, WDM Ethernet equipment, VDSL, fiber and copper Ethernet access devices, EPON, Ethernet and dual Ethernet/TDM microwave equipment, and carrier Ethernet ports by speed.

For more information on Carrier Ethernet equipment and suppliers, visit the Lightwave Buyer's Guide.