100G to drive optical networks market to cross $17.5 billion by 2018: Ovum

Driven by 100G, the size of the optical networks (ON) market will cross $17.5 billion by 2018, growing at a 3.1 percent CAGR from 2012, said Ovum.

Global ON equipment spending is projected to grow at 1.1 percent in 2013 based on positive growth forecasts for North America, SLTE, Asia-Pacific and South & Central America.

North American ON sales in 2013 will grow at 9.1 percent in 2013.

Ian Redpath, analyst, Network Infrastructure, Ovum, said network core investments are resuming and 100G is being deployed in volumes. The North American tier-1 communications service providers (CSPs) and cable operators are investing in their core network to support all traffic types.

Meanwhile, submarine line terminating equipment (SLTE) sales will grow at 3.3 percent after four long down years.


In the Asia-Pacific region, strong growth in China, with help from the ASEAN-5 countries (Indonesia, Malaysia, Philippines, Thailand, and Vietnam) and Australia and New Zealand (ANZ), will mitigate projected market declines in Japan and India.

Ovum’s growth projection for Asia-Pacific ON in 2013 is 3.1 percent.

South & Central America (SCA) ON revenues are projected to grow by 1.6 percent for 2013.

ON spending in SCA has passed the $1 billion mark. This level will be maintained as the SCA economies continue to grow and diversify.

ON spending in the Europe, Middle East & Africa (EMEA) region market will dip 9.6 percent in 2012.

The major technology trend is the ascendancy of 100G, whose revenues exceeded 40G sales for the first time in Q2 2013. 100G spending was up 233 percent for H1, achieving $1 billion in revenue, while 40G was down 24 percent to $942 million.

“Nearly all new large-scale, long-haul optical networks designed and deployed today will be 100G. 100G has assumed the lead position and will not yield within our forecast period,” said Redpath.

ON trends

Two positive market trends are emerging. The first is a need for the CSPs to refresh network technology after a long period of running core networks hotter and delaying investment. The second major trend is the maturity of 100G technology to the point where CSPs have begun deployments at scale.

picture source: telegraph.co.uk

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