Metro optical revenues to hit $9B by 2018, says Dell'Oro

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Service providers' ongoing transition from SONET to DWDM will drive metro optical transport equipment revenues to $9 billion by the year 2018, reports Dell'Oro Group in its newest industry forecast.

The research firm said that WDM equipment sales will be the dominant driver of the metro optical market segment's growth for the next five years and make up the majority of the revenue by the year 2018.

"The metro market is in a state of transition as it moves away from SONET/SDH multiplexers and towards high capacity transport equipment," said Jimmy Yu, vice president of Optical Transport Market Research at Dell'Oro Group. "We believe the result of the network transition will be the continuous decline of SONET/SDH equipment sales at an average annual rate of over 30 percent a year."

Yu added that "service providers will shift their focus to higher capacity packet friendly systems such as optical packet-switches and WDM metro." 

While the second-quarter earnings season is just getting underway, a previous Dell'Oro report revealed that the WDM market overall grew 12 percent year-over-year in the first quarter of 2014 as service providers continued to add more network capacity to keep pace with their business, wholesale and consumer bandwidth needs.

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