Infonetics raises forecast on Carrier Ethernet

Dec. 6, 2011
Infonetics Research says that Carrier Ethernet equipment sales trends have exceeded the company’s expectations.

Infonetics Research says that Carrier Ethernet equipment sales trends have exceeded the company’s expectations. The market research firm has upped its forecast for its current forecast period as a result.

"The Carrier Ethernet equipment market continues to grow strongly, so much so that we've increased our long-term forecast from $37.5 billion to $40.2 billion by 2015,” reports Michael Howard, principal analyst for carrier networks and co-founder of Infonetics Research. “Some market segments are growing faster while others are slowing faster than we originally anticipated. The largest downward changes are in the Ethernet microwave and VDSL equipment segments, and the largest upward change is in the hot Carrier Ethernet switch segment."

According to the research firm, the space has proven recession proof so far. Global sales of Carrier Ethernet equipment this year are expected to be up 15.7% year on year in 2011, reaching $32.0 billion. This increase comes after a year-on-year jump of 30.5% in 2010.

The fact that service providers are spending a significant portion of their capex on such gear has helped the market. For example, the expected 15.7% increase in equipment sales this year comes against a back drop of an anticipated overall telecom capex increase of only 6%. Drivers for service provider interest in Carrier Ethernet equipment include the need to accommodate growing consumer, business, and mobile backhaul traffic, particularly video.

Equipment benefiting most from this trend include routers, Carrier Ethernet switches, and optical gear. Together, these equipment categories compose more than two-thirds of the total Carrier Ethernet market. Infonetics says Cisco tops the Carrier Ethernet switch market with 45% of worldwide revenue, well ahead of potential competitors. ADVA Optical Networking and Ciena lead the Ethernet access device (EAD) market, which Infonetics marks as a fast-growing segment.

The information is contained in Infonetics' most recent Carrier Ethernet report.

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