Network equipment spend in Europe up 8% over 2014

Sep 02, 2015

European sales lift in Q2 2015 the only bright spot in an otherwise flat market for optical hardware, says analyst IHS.

Market research firm IHS Infonetics has published new vendor market share and preliminary analysis from its second quarter 2015 IHS Infonetics Optical Network Hardware report.

According to the report, global optical network hardware revenue (from equipment types for WDM and SONET/SDH systems) grew 22% in 2Q15 from the previous quarter, but sales were flat from the same period one year ago. Europe is the only major world region that posted positive year-over-year growth in 2Q15, up 8%.

“With three consecutive quarters of good results, Europe is signaling a reversal of the terrible optical spending that we have seen in the region over the past five years,” said Andrew Schmitt, research director for carrier transport networking at IHS. “This strength is concentrated in three companies: Alcatel-Lucent, Ciena and Infinera.

“When taking into account currency effects, the results are even stronger: adjusted for exchange rate, optical spending in Europe saw a 30 percent year-over-year growth rate in the second quarter, when measured in euros," he added.

Q2 market highlights

• On a rolling 4-quarter basis, WDM equipment spending further extended 3 years of consecutive growth
• Spending on WDM equipment grew 23 percent in 2Q15 from 1Q15, and was up 6 percent from 2Q14
• WDM gear comprised 86 percent of total worldwide optical hardware revenue in Q2
• Spending on optical network hardware in Asia Pacific surged 36% in 2Q15 from the previous quarter, but is down 2% from a year ago
• Alcatel-Lucent announced an intention to merge with Nokia, an action IHS does not expect to have any transformative effects on ALU╒s optical business or the competitive landscape

Source: Optics.org