Compact modular optical hardware is being used in more network applications than ever before, driving up sales to over US$275 million in Q1 2019, with the market potentially worth US$1 billion for the whole year. These figures were reported in the latest Optical Applications Report from market research firm Cignal AI.
The Q1 2019 report illustrates significant growth throughout most regions, as the compact modular customer base expanded beyond cloud and webscale operators to include traditional telco customers utilising compact modular to enable disaggregation.
Growth was most pronounced in North America in that quarter, where it accounted for almost 30% of the entire optical market and is expected to continue advancing through 2023.
“Network applications for the compact modular form factor have expanded well beyond the original data centre interconnect deployments,” said Scott Wilkinson, Lead Analyst for Optical Hardware at Cignal AI. “Applications now include traditional telco networks, metro and long haul deployments, and even some early trials for subsea deployment. We expect this spending trend to increase in 2019 as new compact modular products come to market from a variety of vendors.”
Cignal AI’s latest Optical Applications Report details market share for the first quarter of 2019, and provides forecasts in three key markets: compact modular equipment, advanced packet OTN switching hardware, and 100 Gbits/s+ coherent WDM port shipments across multiple speeds. Hardware and coherent port shipments are forecasted through 2023.
Additional report findings include:
- Ciena expanded its dominance in compact modular with over 50% market share in Q1. The combined Infinera/Coriant held on to second place despite declining sales
- Acacia AC1200-based platforms are expected to have an impact starting next quarter. Cisco compact modular sales paused in Q1 in anticipation of the NCS1004 platform (*see below)
- Almost 500,000 physical coherent ports have shipped in the last 12 months. Currently, over 70% of coherent ports are shipped by the top five vendors in the market
- After a 2018 recovery year, long haul port shipments are starting to pick up. Metro growth is advancing at a similar pace, as next generation coherent enables an upgrade from 100 Gbits/s
- Packet OTN growth is slowing. New deployments are limited to China and parts of APAC as networks in other regions evolve away from the packet OTN architecture.
Vendors examined include Acacia, Adtran, ADVA, Ciena, Cisco, ECI, Ekinops, Fiberhome, Fujitsu, Huawei, Infinera, Inphi, NEC, Nokia, NTT Electronics (NEL), Padtec, Tejas, Xtera and ZTE.
* NB Earlier this month it was announced that Cisco and Acacia Communications had entered into a definitive agreement under which Cisco has agreed to acquire Acacia for a consideration of US$2.6 billion.
For more information, visit https://cignal.ai/