Optical add/drop multiplexers market to reach $4 billion by 2006, says Allied Business Intelligence Inc.

March 1, 2001
Mar. 1, 2001-The market for optical add/drop multiplexers (OADM) will grow from $338 million in 2000 to over $4 billion in 2006 -- a 53 percent compound average annual growth rate.

According to Allied Business Intelligence Inc., an Oyster Bay, NY-based technology research think tank specializing in communications and emerging technology markets, the market for optical add/drop multiplexers (OADM) will grow from $338 million in 2000 to over $4 billion in 2006 -- a 53 percent compound average annual growth rate. This growth will be driven by both the increase in DWDM systems and the expanding use of more expensive reconfigurable OADMs.

Despite all the hype, DWDM is still in an early stage of development. Its deployment in the terrestrial long-haul applications is well advanced in North America and has been introduced over the past two years in Europe. DWDM is just appearing in long-haul applications in other parts of the world and in metro networks. The metro market will grow rapidly, beginning in North America and in Europe.

Fixed OADMs have been used in terrestrial long-haul applications for years. However, remotely reconfigurable OADMs offer many advantages, particularly in metro networks, where there will be frequent reprovisioning of the systems as carriers gain and lose customers.

"As metro networks acquire more customers and more wavelengths, it is going to become impossible to provision by sticky-note, manually figuring out what it is in the system that needs to be changed and then scheduling an engineer to go out and change it," said Marc Liggio, VP of Broadband Research and principal author of the report. "Customers don't want to wait 90 days. Reconfigurable OADMs allow changes to be done remotely and simultaneously via computer."

Remotely reconfigurable OADMs are more expensive, and their use will depend on the market. Carriers outside of Western Europe and North America, where economies are less developed, may tend to shy away from the extra cost.

ABI's new report, "Optical Add/Drop Multiplexers: World Markets and Opportunities for Fixed and Reconfigurable OADMs in the Long-Haul and Metro Networks," provides an overview of the markets for fixed and remotely reconfigurable OADMs. It forecasts shipments to the submarine, long-distance terrestrial and metro segments of four regions of the world: Asia-Pacific, Europe, North America and the rest of world.

About Allied Business Intelligence Inc.

Allied Business Intelligence Inc. is an Oyster Bay, NY-based technology research think tank specializing in communications and emerging technology markets. ABI publishes strategic research on the broadband, wireless, electronics, networking and energy industries. For more information, visit www.alliedworld.com.