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Market Update Report - High Speed Optics Add Momentum to the Market

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This publication has been discontinued on May 29, 2014.

The top line numbers for the optical component and module sales were almost flat in 2012-2013. However, there is a lot of action under the surface of these steady top-line numbers. While numerous network upgrade projects continue worldwide, fierce competition among suppliers of telecom equipment, optical components and modules pushes down prices and negatively impacts revenue growth.

Analysis of publicly reported revenues of equipment vendors combined with confidential sales data of optical components and modules, collected by LightCounting, offer a unique insight into market dynamics, presented in this report. The report also presents analysis of network bandwidth growth calculated from data on shipments of opto-electronic interface modules employed in telecom, enterprise, and storage area networks. This approach to tracking the market offers an effective method for identifying the timing and scope of infrastructure upgrade cycles, technology transitions, and even product life cycles.

In addition to in-depth market analysis, this report offers summaries of the latest business developments and financial performance for leading equipment manufacturers. It also includes sales data on more than 100 product categories covering the period from Q1 2012 to Q2 2013 for SONET/SDH, Ethernet, Fibre Channel, CWDM, DWDM, FTTx transceivers, and high speed optical interconnects, including active optical cables. The report also discusses guidance for the second half of 2013 and potential changes to LightCounting's market forecast published in July 2013. Data for the report was provided by more than 25 leading module and component vendors.

Table of Contents

Abstract

Table of Contents

Executive Summary

  • The markets will remain volatile on a quarterly basis
  • Higher speed Ethernet is taking off
  • Are network operators overinvesting in 100G networks?
  • FTTx transceiver market will decline in 2013
  • Latest financial reports of AT&T and Verizon solidify business case for FTTx

Section 1 Telecom Equipment Market and Vendor Highlights

  • ADTRAN's European customer boosts Q3 results
  • ADVA looks to vertical markets for customer and revenue growth
  • Alcatel-Lucent faces testing time as it executes The Shift Plan
  • Ciena delivers consistent business improvement
  • Ericsson's Networks division's revenues up in 2013 despite complex market
  • Fujitsu continues to promote its cloud strategy
  • Huawei will maintain number one ranking in 2013
  • Infinera evolves its transport strategy as it grows 100G market share
  • Nokia Solutions and Networks (NSN) grows in importance for parent Nokia
  • Tellabs agrees to be acquired by Marlin Equity Partners
  • ZTE revenues come back to earth, at least for now

Section 2: Ethernet and Storage Networking Equipment Market and Vendor Highlights

  • Brocade Networks reports a short term slump in storage
  • Cisco is having a good year
  • Dell: Servers and networking equipment sales strong as company goes private
  • EMC focuses on emerging storage systems as high-end systems slump
  • Emulex #2 in 10GigE adapters but sees flat business due to litigation
  • HP has not stopped its revenue slide
  • IBM talks "big divestiture" amidst hardware sales woes
  • Juniper Networks benefits from strong service provider router sales
  • Mellanox gaining share in Ethernet
  • QLogic restructuring after continued weak sales

Section 3: Sales of Optical Components and Modules

  • SONET/SDH Transceiver Market
  • CWDM and DWDM Interfaces
  • Ethernet transceivers
  • Fibre Channel transceiver market
  • FTTx transceivers
  • Optical interconnect market
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