A new cycle of investment in optical networking in taking place in all regions except Europe, the Middle East and Africa (EMEA), says market research company, Ovum. Market growth is being led by North America, while spending is also up in Asia Pacific (APAC) and South and Central America (S&C America). But EMEA will again be down in 2013.
Source data: Ovum
Ovum forecasts that the global optical networking market will grow to US $17.5 billion by 2018, a compound annual growth rate of 3.1 percent.
Optical networking spending in North America will be up 9.1 percent in 2013 after two flat years. North American tier-1 service providers and cable operators are investing in the core network to support all traffic types, and 100 Gigabit is being deployed in volume.
In contrast, optical networking sales in EMEA will contract by nearly 10 percent in 2013. “Non-spending in Europe is the major factor in the overall EMEA decline,” says Ian Redpath, principal analyst, network infrastructure at Ovum.
The major technology trend for this forecast is the ascendancy of 100 Gig, whose sales exceeded 40 Gig revenues in 2Q13
EMEA optical networking spending has been down in four out of the past five years, and the lack of investment is becoming acute, says Ovum. Given that service providers are stretching their existing networks, spending will have to take place eventually to make up for the prolonged period of inactivity.
This year has seen 100 Gigabit become the wavelength of choice for large WDM systems, with sales surging. Spending on 100 Gigabit has now overtaken spending on 40 Gigabit which declined in the first half of the year.
"The major technology trend for this forecast is the ascendancy of 100 Gig, whose sales exceeded 40 Gig revenues in 2Q13," says Redpath.
Further reading:
Ovum: Optical networks forecast: top line steady, 100G surging, click here