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Introduction

Annualized global optical networking (ON) spending grew 2.6% sequentially and 7.4% versus 1Q15 to $14.9bn in 1Q16. For 1Q16 alone, global ON revenues of $3.5bn were down nearly 16% from 4Q15, but came in 12.1% higher than 1Q15. Huawei, Nokia, ZTE, and Adva were the only vendors to gain share in 1Q16.

Highlights

  • ON spending grew in double digits versus the prior year’s quarter for the second consecutive quarter, pushing total annualized spending to $14.9bn, 7.4% higher than the year-ago period.
  • Huawei maintains its grip on market leadership. Huawei, Nokia, ZTE, and Adva gained share while Infinera, Cisco, Coriant, FiberHome, Ciena and Fujitsu all lost share.
  • The market declined sequentially in all regions off the strong 4Q15. However, versus 1Q15, results were surprisingly good, growing in all regions. Global spending on WDM/CPO-T exceeded $11.4bn in the 1Q16 rolling 4-quarter period, 77% of the total global ON market. The SLTE market declined 18.6% in 1Q16 but was up 17.9% versus the year-ago quarter, pushing annualized revenues to $766m.

Features and Benefits

  • Details revenues of top-performing vendors in the global ON market, including share position by segment and region.
  • Examines changes in product demand resulting from the global economic climate.
  • Discusses how actual market results are tracking to Ovum's forecasts by region, segment, and subsegment.

Key questions answered

  • How did the global optical networking market perform in 1Q16 and for the past 4 quarters? What are the trends by product segment and region?
  • Which ON vendors are increasing their share in the global market? Which products are behind their success?
  • How are actual results tracking to Ovum's most recent forecast?
  • Which segments and regions are outperforming or underperforming expectations and why?

Table of contents

Summary

  • In brief
  • Ovum view

1Q16 results

  • ON market off to good start in 1Q16

Market share

  • Losers outnumber winners

Market share changes

  • Huawei, Nokia, ZTE, and Adva see share gains

Vendor highlights

  • Product and market highlights in 1Q16

Regional analysis

  • All regions down but results were better than the year-ago quarter, indicating a good start to the year

Product-level analysis

  • Segment overview: technology-level analysis

Market outlook

  • The ON market continues on track to $18bn by 2020, driven by network and data center operator demand

Appendix

  • Methodology
  • Further reading
  • Author

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