Dell’Oro: 3Q21 Total Telecom Equipment Market up 6% year-over-year & 9% year-to-date
Dell’Oro Group just completed their 3Q21 reporting period for all the Telecommunications Infrastructure programs covered. Those include: Broadband Access, Microwave & Optical Transport, Mobile Core & Radio Access Network (RAN), SP Router & Switch.
The data contained in these reports suggest that the positive trends that characterized the broader telecom equipment market in the first half of 2021 extended into the third quarter, propelling the overall telecom equipment market to a sixth consecutive quarter of year-over-year (Y/Y) growth in revenues.
Preliminary estimates suggest the overall telecom equipment market advanced 6% Y/Y in the quarter and 9% Y/Y year-to-date (YTD). The growth in the quarter was underpinned by healthy demand for both wireless and wireline equipment.
While the majority of the suppliers were able to navigate the supply chain situation fairly well in the first half, supply chain disruptions had a greater impact in the third quarter, though clearly this was not enough to derail the positive momentum that has characterized the market over the past six quarters.
The analysis contained in these reports suggests the collective global share of the leading suppliers remained relatively stable between 2020 and 1Q21-3Q21, with the top seven vendors comprising around ~80% of the total market.
Ongoing efforts by the US government to curb the rise of Huawei is starting to show in the numbers, especially outside of China. At the same time, Huawei continued to dominate the global market, still nearly as large as Ericsson and Nokia combined.
Overall, we believe ZTE and Samsung are trending upward while Huawei is losing some ground YTD relative to 2020.
Additional key takeaways from the 3Q21 reporting period include:
- Positive market sentiment in the third quarter was driven by strong growth in RAN and Broadband Access, which was more than enough to offset weaker trends in Optical Transport.
- RAN and Broadband Access are also the strongest growth vehicles for the YTD period, fueled by surging demand for 5G, PON, and FWA CPEs.
- With the pandemic resurging and the visibility surrounding the supply chain weakening, the Dell’Oro analyst team is expecting near-term growth to decelerate – the overall telecom equipment market is now projected to advance 2% in 2022, down from 8% in 2021.
Dell’Oro Group telecommunication infrastructure research programs consist of the following: Broadband Access, Microwave Transmission & Mobile Backhaul, Mobile Core Networks, Radio Access Network, Optical Transport, and Service Provider (SP) Router & Switch.
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Ethernet-based Routers and Switches continue to make up an increasing portion of the Data Center Interconnect (DCI) market as ZR modules and 400 Gbps platforms begin to ramp in volume.
Cloud service provider network topologies favor the use of Ethernet systems. As these operators continue to carry a growing proportion of Internet traffic, Ethernet-based systems are transporting a growing amount of all Internet and 5G traffic. ZR and ZR+ will play an important role in defining boundaries between edge and core data centers as well as the backhaul of 5G traffic.
“Ethernet-based Routers and Switch continue to make up an increasing portion of the DCI market as ZR modules and 400 Gbps platforms begin to ramp in volume,” said Alan Weckel, Founder and Technology Analyst at 650 Group. “Cloud service provider network topologies favor the use of Ethernet systems. As these operators continue to carry a growing proportion of Internet traffic, Ethernet based systems are transporting a growing amount of all Internet and 5G traffic. ZR and ZR+ will play an important role in defining boundaries between edge and core data centers as well as the backhaul of 5G traffic.”
The Quarterly DCI report indicates that the top four western Ethernet DCI vendors were Juniper, Cisco, Arista, and Nokia. The top four Optical Transport DCI vendors were Ciena, Cisco, Infinera, and Nokia. In addition, the report highlights how Cloud providers, especially Hyperscalers, adopt technology differently than traditional SPs.
About the Ethernet Switch Quarterly Report
The Data Center Interconnect (DCI) Report offers a market assessment of vendor performance and market share across Routers, Switches, and Optical Transport gear used for DCI. The report covers Modular, Fixed, regional data, and segmentation for Cloud, Telco, and Colocation based deployments. For more information about the report, contact the sales department at 650 Group at +1 650 600 7104 or [email protected] or http://www.650group.com.
About 650 Group
650 Group is a leading Market Intelligence Research firm for communications, data center, and cloud markets. Our team has decades of research experience, has worked in the technology industry, and is actively involved in standards bodies.
https://www.650group.com/press-releases/ethernet-data-center-interconnect-dci-reaches-new-all-time-high-in-3q21-according-to-650-group
It’s surprising that the telecom equipment market is up YoY and YTD since network providers have not significantly increased CAPEX. You’ve written this article so well. In fact, this post is outstanding! Thanks for sharing.