Ciena (NASDAQ: CIEN), Cisco (NASDAQ: CSCO), and Infinera (NASDAQ: INFN) are leaders among optical network hardware vendors, as reckoned by IHS (NYSE: IHS) in its new 2015 IHS Infonetics Optical Network Hardware Vendor Scorecard. The market research company's scorecard covers the 10 companies that have generated the most fiber-optic network equipment sales over the past year and groups them into such categories as "Leader," "Established," and "Challenger."
The top 10 companies in the space are ADVA Optical Networking, Alcatel-Lucent, Ciena, Cisco, Coriant, ECI, Fujitsu, Huawei, Infinera, and ZTE. To protect sales of the report, IHS is being coy about how these companies rank in terms of revenue as well as how the non-leaders were characterized. However, Andrew Schmitt, research director for carrier transport networking at IHS, described the measurement criteria in response to an inquiry.
"We use hard data and hard customer feedback and use a model to calculate the results. There is no subjectivity on my part and the model is used across all of our product areas," Schmitt wrote. "We have some criteria that measure market presence, which is where companies are today (market share, financials, customer perception on certain issues, etc.) and market momentum, which measures future direction (market share shifts, customer opinions, involvement in key technological areas). Companies that are above average for both categories are leaders. Those stronger with momentum are challengers, and those stronger with presence are established."
After leaders Ciena, Cisco, and Infinera, four of the remaining seven companies were ranked established and the other three challengers, Schmitt added.
Ciena earned its leadership mantle due to its status as the second-most successful supplier of WDM gear, its market momentum in 2014, and its growing success in packet-optical transport systems. Cisco earned its stripes via its solid balance sheet, high regard among customers, and its pioneering work in integrating the IP and optical layers. Infinera rode its success in servicing the Internet content provider and data center interconnect market, significant gains in market share, and healthy financial status.
"The optical equipment market is fracturing into one of traditional service providers and another of competitive service providers and internet content providers. The leaders in our 2015 optical scorecard -- Ciena, Cisco, and Infinera -- are focusing on one of these markets or have the necessary scale to address both with independent solutions," explained Schmitt via a press statement announcing the scorecard results.