Telecom Lead Asia: Global optical network hardware market, including WDM and SONET/SDH, fell 2 percent sequentially in the third quarter of 2012.
WDM optical revenue grew 6.9 percent in 3Q12 from 2Q12, bolstered by a strong performance from Huawei.
SONET/SDH optical spending continued its sharp fall, down 19 percent sequentially and 33 percent year-over-year.
NEC, Fujitsu, and Infinera had a strong 3Q12, with revenue up by double digits thanks to robust ROADM equipment spending.
Alcatel-Lucent posted its lowest-ever optical revenue results in 3Q12, with the majority of the decline coming from its WDM business.
Infonetics Research said investment cycle will begin next year in the core network that’s based on 100G coherent and supported by the massive ramp in 100G prototyping and trialing activities that are already underway worldwide.
Performance in North America and EMEA (Europe, the Middle East, Africa) was relatively weak, although North America is expected to resume moderate growth in 4Q12 as AT&T and Verizon ramp spending.
“Investment in new WDM gear is growing, but it isn’t growing fast enough to offset the accelerated declines in SONET/SDH,” notes Andrew Schmitt, principal analyst for optical at Infonetics Research. “SONET/SDH spending hit another all-time low in the third quarter, as architectural shifts in wireless backhaul quicken its transition into obsolescence. Carriers aren’t allocating scarce capital to out-of-date equipment.”