Monday April 22, 7:55 am Eastern Time
Press Release
SOURCE: Communications Industry Researchers, Inc.
New Report Says OADM Components Market to Average 52 Percent Growth Rate; Outlines Rules for Success
CHARLOTTESVILLE, Va., April 22 /PRNewswire/ -- The market for Optical Add/Drop Multiplexer (OADM) components and subsystems is expected to grow at an average annual rate of 52 percent from 2002 to 2006, according to a new report announced today by Communications Industry Researchers, Inc. (CIR). The new study, OADM Markets And Opportunities: 2002-2006, indicates that these devices offer significant opportunities. But, it warns that components and subsystems vendors must obey four key rules to succeed:
* Don't overestimate the size of the market. Metro rings are being
installed cautiously, and few service providers see the need to deploy
more than three OADMs on a ring or long-distance point-to-point link.
In contrast to some other firms, CIR research does not indicate a
scenario in which abundant wavelength services will call for a large
number of OADMs to be deployed. The worldwide OADM market will be worth
hundreds of millions of dollars in a few years, not the billions that
other forecasters have claimed, and the business plans of OADM suppliers
should reflect these more modest expectations.
* Be quick to market. Early design wins will be important for smaller
OADM subsystems vendors. Well-entrenched players JDS Uniphase and
Corning are currently both working very hard to become the OADM
supplier-of-choice to the leading systems houses, and they are gradually
shutting out other manufacturers from lucrative opportunities.
Corning's OADM subsystem, for example, is already being used in Ciena's
and Marconi's gear. However, even if the components powerhouses end up
taking the lion's share of the OADM subsystems market, there will be
growing potential for middle-sized OADM companies to act as second-
source suppliers.
* Stress stability. CIR research indicates that the large systems houses
are increasingly reluctant to design in OADM subsystems from smaller
manufacturers, fearing that they might disappear in a few months.
Equipment vendors have told CIR that they are more likely than in the
past to go to firms that have been around for a while, such as DiCon.
Two major OADM subsystems providers -- Avanex and Oplink -- have
recently combined to create a larger entity in which they hope customers
will have greater confidence.
* Stress cost advantage, not technology. The days are gone when novel
technology alone can grab attention. System integrators are looking to
lower costs and show their carrier customers how to decrease their costs
as well. CIR has found that there are no established technologies of
choice for reconfigurable OADMs as yet, so the market is wide open to
new approaches that can provide large savings. CIR believes that
current efforts to provide optically integrated OADMs should lead to
significant cost improvements within a few years.
OADM Markets And Opportunities: 2002-2006 provides five-year projections of OADM subsystems markets, broken down by access, metro and long-haul applications. These sectors are also broken down by technology type. In addition, the report provides forecasts of other components used in OADMs, notably light sources and amplifiers. Profiles of all leading OADM subsystems suppliers -- both established companies and start-ups -- are also included. CIR's analysis of the OADM subsystems market is based on a deep understanding of customer buying patterns and guided by an ongoing interview program with service providers and equipment vendors, as well as with subsystems/components producers. Based on this agenda, the study also includes profiles of the OADM requirements of major system houses.
The report is available for $4,500 in hardcopy and is also available in electronic versions. Click here cir-inc.com for more information on OADM Markets And Opportunities: 2002-2006. Members of the press may receive an Executive Summary of the report by contacting Meg Morris via email at meg@cir-inc.com.
CIR is a leading industry analyst firm specializing in the areas of optical networking systems, software and components. Through its reports, market advisory services and custom client engagements, CIR provides insightful research, analysis and consulting services for the optical market. CIR relies upon service provider activities and ``demand side'' research as the basis for its opinions and forecasts, so as to provide realistic and credible analysis and insights for both its clients and the industry at large.
SOURCE: Communications Industry Researchers, Inc. |
