Optical gear spending drops 5% as traditional providers tighten spending strings

Spending on optical networking equipment has dipped 5 percent year-over-year as Tier 1 telcos become cautious about spending capital on new network builds, according to Infonetics' third-quarter 2014 Optical Network Hardware report.

"A spending divergence is opening in the optical market, with some service providers, primarily competitive carriers and Internet content providers, growing spend, while traditional carriers proceed with caution," said Andrew Schmitt, principal analyst for carrier transport networking at Infonetics Research. "Companies less dependent on EMEA and incumbent carriers are faring better--this effect explains the varying sentiment in the industry."

Although WDM equipment revenue rose 4 percent year-over-year, spending trends waned in North America, while EMEA continued to decline.

North America stopped leading the optical market in the third quarter of 2014, with strong results from Ciena being offset by weaker performance of other vendors.

Infonetics said that Europe remains in an optical slump due to a weak macro economy, and Asia Pacific declined by double digits on a sequential basis.

For more:
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