Infonetics: Packet optical transport and 40G represent big opportunities for non-incumbent vendors

OCTOBER 24, 2008 -- A new Infonetics Research study of incumbent and competitive service providers in North America, Europe, and Asia Pacific shows that 86% expect their packet optical transport networks to save them operational expenditures.

OCTOBER 24, 2008 -- A new Infonetics Research (search for Infonetics) study of incumbent and competitive service providers in North America, Europe, and Asia Pacific shows that 86% expect their packet optical transport networks to save them operational expenditures, of which more than two-thirds expect opex savings of at least 11% to over 50%, an important driver in today's competitive environment.

Service providers participating in the study, Service Provider Plans for Packet Optical Transport and 40G, named product reliability and standards compliance as their top criteria when choosing a packet optical transport network equipment vendor. An unusually low number of providers said they choose vendors based on having that vendor's equipment already installed in their network, suggesting an opportunity for non-incumbent vendors.

"Packet optical transport equipment -- and 40G and later 100G equipment, for that matter -- can open the door for a vendor to gain a service provider as a new customer for their optical equipment, breaking the buy-from-the-current-supplier habit," commented Michael Howard, principal analyst of Infonetics Research. "Even in these troubled economic times, 62% to 72% of service provider respondents plan to increase their 40G spending each year between 2009 and 2011 and later, so Infonetics recommends that manufacturers be ready with right-priced products to take advantage of the expected expansion of 40G expenditures."

More highlights from the study include:


  • In a series of questions asking service providers to rate six packet optical transport network equipment vendors (Alcatel-Lucent, Cisco, Fujitsu, Huawei, Nokia Siemens, and Nortel), Nortel scored highest for technology and product roadmap; Nokia Siemens scored highest (by a hair) for security; and Alcatel-Lucent scored highest for management.
  • An increasing number of service providers plan to invest more in packet optical transport systems (POTS) products in the next few years (examples of POTS products: ECI XDM, Cisco 15454 MSTP, Ciena 4200RS, Nortel OME 6500, Siemens hiT 7080).
  • Service providers say the principal use of 40G over the next 5 years will be to aggregate 10G flows, which reduces the number of ports needed, and reduces management and operations costs.
  • 100G optical and 100G Ethernet products will likely appear in about 2 years, first in proprietary form, then in standards form in 2011.

Infonetics' study is based on formal interviews with 29 service providers in North America, Europe, and Asia Pacific and informal discussions with these and many other service providers during the past 12 months. About 80% of the study respondents are the primary decision-maker or have "a lot of influence" on purchase decisions for packet optical transport network equipment, Infonetics asserts.

A packet optical transport network carries packet traffic, typically Ethernet, on SONET/SDH and/or WDM gear.

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