Alcatel-Lucent, Ciena, Cisco face challengers in P-OTS market as revenue ramps 41 percent
Alcatel-Lucent (NYSE: ALU), Ciena (Nasdaq: CIEN) and Cisco (Nasdaq: CSCO) may be the largest optical transport network (OTN) switching and transport equipment and packet-optical transport systems (P-OTS) vendors, but a new Infonetics report said they are being challenged by a host of pure-play P-OTS platform vendors.
The emerging pure-play P-OTS vendor market has been driven by a mix of emerging and incumbent vendors, including BTI, Cyan, Ericsson (Nasdaq: ERIC), and Transmode.
BTI's P-OTS platforms, for instance, have been resonating with large customers such as Equinix, which deployed its BTI 7000 Series to interconnect its data centers in Singapore. Likewise, Cyan has been winning deals with a number of competitive middle mile operators and incumbent telcos.
P-OTS system growth was a key highlight in the optical market, one where revenue rose 41 percent year-over-year in the first half of 2013.
Andrew Schmitt, principal analyst for optical at Infonetics Research, said that "P-OTS growth in the first half of 2013 was healthy as a result of Tier 1 carriers ramping spending versus 2012," adding that "some of the SONET/SDH spending that went away come back in the form of increased packet-optical activity."
At the same time, OTN switching revenue rose 23 percent in the first half of the year to $3.9 billion. In North America, OTN switching spending tripled in during the same period, up 80 percent from the same period a year ago.
"OTN switching is experiencing breakout growth in North America and EMEA (Europe, Middle East, Africa), where service providers are adopting integrated WDM and OTN switching and rolling out 100G coherent in the core," Schmitt said.
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