Telstra (ASX: TLS.AX) announced Tuesday during the Mobile World Congress event in Barcelona that it will deploy Ericsson's (Nasdaq: ERIC) optical gear as its 100G coherent network platform.
For this deployment, Telstra will deploy a mix of Ericsson equipment supporting both its metro and long-haul applications, including the SPO 1400 family and the MHL3000 for long-haul applications, including support for 100 Gbps services.
The service provider will deploy a mix of ROADM, multiservice DWDM, and Packet Optical Transport Platform (P-OTP) equipment.
By deploying this gear, Telstra said it will be able to reduce total cost of ownership by reducing the number of network elements and equipment space and consolidating operations and maintenance for the network with reduced power consumption.
Ericsson is already providing Telstra with a suite of long-haul equipment. This deal expands its presence in the Australia-based telco's metro, regional and inter-city optical networks.
From an overall optical industry perspective, the Telstra deal ups Ericsson's profile in a market that's been dominated by four vendors: Alcatel-Lucent (NYSE: ALU), Ciena (Nasdaq: CIEN), Huawei, and increasingly Infinera (Nasdaq: INFN)--which increased its profile in the U.S. Tier 1 market as one of CenturyLink's (NYSE: CTL) 100G suppliers last fall.
It also comes during a transitional time in the optical network hardware market, where a handful of existing players have been weathering a challenging economic environment and slower carrier spending cycles.
While the global optical network hardware market rose 2 percent sequentially in Q4 2012, a new Infonetics report said that it declined 13 percent from Q4 2011 due to a 30 percent decline in the SONET/SDH segment. The report forecast that the ongoing migration to 100G will drive an uptick in optical spending in 2013.
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