Dell’Oro: Market for disaggregated WDM systems increased 142% YoY in 1Q-2018

A new report from market research firm Dell’Oro Group states the market for disaggregated WDM platforms increased at a 142% year-over-year (YoY) growth in sales in the first quarter of this year.  This high growth was driven by the adoption of disaggregated WDM systems expanding beyond web-scale companies and data center interconnect (DCI).   

“Small form factor, disaggregated WDM systems were developed for the hyperscalers,” said Jimmy Yu, Vice President at Dell’Oro Group. “And for a long period of time, they were the only large purchasers. However, now we see a growing number of buyers that include cable operators and wholesale carriers.  We think this is just the start of a good thing, and expect demand for these disaggregated systems will continue to grow at a hyper-scale rate,” added Yu.

Disaggregated WDM systems reached an annualized revenue run-rate of $800 million in the first three months of this year and Dell’Oro projects the run rate will exceed $925 million for full-year 2018. Ciena and Infinera currently have enjoyed the most success in this niche, with a combined market share of approximately 60% for the trailing four quarters ending in 1Q-2018.

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Author’s Note:  The move towards disaggregated network equipment started in the Open Compute Project (OCP) Networking and Telco groups.  It’s now being propelled forward by the the Telecom Infra Project (TIP) which aims to create greater innovation and flexibility through disaggregation of traditional (vendor specific/proprietary) network equipment.  TIP is also  attempting to disaggregate optical line terminal equipment (e.g. OLT) and transmission systems such as those that use mmWave frequencies.  We first wrote about this disaggregation mega-trend almost three years ago in this article.

Here’s a schematic of an open line system (OLS), which allow transponders from many different suppliers to share a single line system:

Figure 1: Open Line System

                                                                       Figure courtesy of Infinera

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Dell’Oro Group’s “Optical Transport Quarterly Report” provides tables stating manufacturers’ revenue, average selling prices, and unit shipments (by speed, including 40 Gbps, 100 Gbps, 200 Gbps, and 400 Gbps). The report tracks DWDM long-haul terrestrial, WDM metro, multiservice multiplexers (SONET/SDH), optical switches, optical packet platforms, and data center interconnect (metro and long haul).

To purchase this report, call Daisy Kwok at +1.650.622.9400 x227 or email Daisy@DellOro.com.

About Dell’Oro Group
Dell’Oro Group is a market research firm that specializes in strategic competitive analysis in the telecommunications, networks, and data center IT markets.  Our firm provides in-depth quantitative data and qualitative analysis to facilitate critical, fact-based business decisions.  For more information, contact Dell’Oro Group at +1.650.622.9400 or visit www.delloro.com.

 

2 thoughts on “Dell’Oro: Market for disaggregated WDM systems increased 142% YoY in 1Q-2018

  1. ONF’s ODTN Project Brings Disaggregation and Open Source to Optical Networking

    Strong member community includes telco operators and leading optical vendors
    Leveraging the proven models of open source and disaggregation to bring transformation to optical transport networks. Five tier-1 operators have committed to trials.

    ONF announced a new community effort to bring the benefits of open networking to the optical domain. The Open Disaggregated Transport Network (ODTN) project is an operator-led initiative to build optical transport networks using disaggregated optical equipment, open and common standards, and open source software. Backed by some of the world’s largest network operators, China Unicom, Comcast, NTT Communications, Telefonica and TIM are collaborating to build this first-of-its-kind open source platform to initiate a transformation within optical transport networking.

    Each of the five founding operators has committed to performing lab integration and evaluation of the platform for future transport applications. Additional support is coming from leading vendors in the optical equipment space, with NEC, NOKIA, Oplink, ZTE contributing to the software platform and building full solutions, CTTC contributing from academia, and ADVA, Ciena, Coriant, CoAdna, Infinera and Lumentum participating in lab and field trials.

    https://www.opennetworking.org/news-and-events/press-releases/onfs-odtn-project-brings-disaggregation-and-open-source-to-optical-networking/

  2. Alan Weissberger, thanks so much for the post on disaggregated optical network equipment.
    Really great!

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