Optical network hardware hits highest quarter since 2001

OCTOBER 12, 2007 -- The worldwide optical network hardware market is forecast to post the highest annual revenue in 2007 since the optical market crashed in 2001, says Infonetics Research (search for Infonetics) in its latest Optical Network Hardware report.

For the quarter, the market gained 14% to hit $3.5 billion, the highest quarter since the fourth quarter of 2001, the report shows.

"Most manufacturers in the optical network hardware market posted gains in the second quarter, particularly perennial leader and bellwether indicator Alcatel-Lucent, which posted a 23% gain. Because of the strong trends we're seeing with growing broadband, corporate, mobile telephony, and mobile data traffic, we've upgraded our forecast for 2007 and long-term by about $1 billion per year," said Michael Howard, principal analyst at Infonetics Research.

Packet optical network platforms, a new category of equipment that has emerged in the optical space, are forecast by Infonetics to reach $1.7 billion in annual sales in 2010, growing at a phenomenal rate between now and then. Packet optical network platforms can be configured flexibly with Ethernet, WDM, ROADM, and SONET/SDH functions, operating as migration platforms in IP transformation projects as service providers move from SONET/SDH transport to Ethernet over WDM.

Other report highlights:

• Worldwide optical manufacturer revenue will grow to over $13 billion in 2010, as WDM product revenue increases each year and SONET/SDH revenue decreases each year starting in 2008.
  
• Worldwide metro optical manufacturer revenue is up 14% in 2Q07 over 1Q07.
  
• After being dominated for many quarters by three players--ADVA Optical, Cisco, and Nortel -- the worldwide metro WDM optical market is now led by Alcatel-Lucent, starting in 4Q06.
  
• Tellabs shoots up to the #1 spot in the worldwide metro ROADM market after posting record revenue gains from its Verizon contract; Cisco is now second, Fujitsu third.
  
• In 2Q07, 35% of all optical network hardware revenue came from EMEA, 34% from North America, 25% from Asia Pacific, and 6% from CALA.
  

Infonetics' report provides market share, market size, and forecasts for metro and long-haul optical equipment, broken out by SONET/SDH versus WDM, with transport and switch splits, DWDM and CWDM splits, and ROADM/non-ROADM splits. The report now tracks packet optical network platforms as well. Forecasts and regional market share are updated quarterly and cover all regions.

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