Cignal AI: Worldwide Optical Hardware Spending Increases; Huawei Remains #1 Vendor

by Scott Wilkinson and Andrew Schmitt, Cignal AI

Optical hardware spending grew in every region and for every business segment during 2Q2019, according to the most recent Optical Hardware Report from research firm Cignal AI. Huawei retained top market share worldwide and held steady despite a slowdown in China and increasing competitive and political pressures.

This quarter marked a turnaround for CALA, reversing multiple quarters of decline with a YoY surge of 30%. EMEA also grew with expansion across all product segments. Overall growth in North America was minor and would have been negative again if not for an enormous SLTE revenue increase this quarter. Finally, the rapid expansion in Japan for the past few quarters settled down to a more moderate pace with Ciena, NEC, and Huawei as the prime beneficiaries.

“Huawei managed to retain market share in what is typically its strongest quarter of the year,” said Scott Wilkinson, Lead Analyst at Cignal AI. “Despite the export ban of many optical components and the reports of competitive wins against Huawei in EMEA and APAC, Huawei market share remained steady.”
Cignal AI’s Optical Hardware Report is issued each quarter and examines optical equipment revenue across all regions and equipment types. The analysis is based on financial results, independent research, and guidance from individual equipment companies. Forecasts are based on overall spending trends for equipment types within the regions.
Additional Key Findings in 2Q19 Optical Hardware Report Include:
  • WDM Long Haul Spending Up – Long haul spending recovered in every region except Japan, as compact modular equipment and new high-speed coherent optics impact investments.
  • WDM Metro Declines in North America But Grows in All Other Regions – Factors contributing to the NA decline are the lower price per bit of new high-speed optics and competing priorities like the 5G rollout.
  • SONET/SDH Hangs On – Growth in APAC and EMEA offset SONET/SDH’s ongoing decline in NA. This growth comes from expansions and upgrades to existing networks; there are no new builds.
  • China’s Growth Slows — Growth in China appears dramatic due to the ZTE shutdown and the absence of revenue a year ago. Excluding ZTE’s results, growth slowed.
  • Coherent Optic Shipments Tracking to Reach Nearly 1 Million 100G Equivalent Ports in 2019 – This represents a 40% increase in bandwidth over 2018.
Interactive Optical Hardware Market Share Tracker
Cignal AI’s interactive Optical Hardware Market Share Tracker is available to clients of the Optical Hardware Report and provides quarterly up-to-date market data for real-time visibility on individual vendors’ results as they are released. Users can manipulate data online and see information in a variety of useful ways.
About the Optical Hardware Report
The Cignal AI Optical Hardware Report is published quarterly and includes market share and forecasts for optical transport hardware used in optical networks worldwide. In addition to the interactive tracker, analysis includes a detailed Excel database as well as PDF and PowerPoint summaries. Subscribers to the Optical Hardware Report also have access to Active Insight, Cignal AI’s real-time news service on current market events.
The report examines revenue for metro WDM, long-haul WDM and submarine (SLTE) equipment in six global regions and includes detailed port shipments by speed. Vendors in the report include Adtran, ADVA, Ciena, Cisco, ECI, Ekinops, Fiberhome, Fujitsu, Huawei, Infinera, Mitsubishi Electric, NEC, Nokia, Padtec, Tejas, Xtera, and ZTE.
full report description, as well as articles and presentations, are available on the Cignal AI website.
About Cignal AI
Cignal AI provides active and insightful market research for the networking component and equipment market and the market’s end customers. Our work blends expertise from a variety of disciplines to create a uniquely informed perspective on the evolution of networking communications.
Contact Us/Purchase Report:
sales@cignal.ai

CignalAI: Cloud and Colo Optical Hardware Spending Increases by 50% in North America; Century Link’s impressive fiber buildout

by Cignal AI staff

Overview:

Cloud and colocation (colo) operator spending on optical communications hardware continued to spur market growth in the first quarter of 2019, according to the most recent Optical Customer Markets Report from research firm Cignal AI. Cloud and colo spending increased over 50% in North America, offsetting declines in other regions, with Ciena continuing to lead all sales to cloud operators.

In EMEA, traditional telco (incumbent and wholesale network operators) optical spending recovered and will grow by double digits during 2019. Spending growth by these operators is slowing in APAC as total spending reaches record highs. Huawei continues to lead this market in APAC, EMEA, and CALA, while Ciena leads in North America.

“Optical spending in North America continues to shift from traditional telco providers to the cloud and colo operators,” said Scott Wilkinson, Lead Analyst for Optical Hardware at Cignal AI. “Despite traditional telco operators accounting for most spending, the rapid growth in cloud spending combined with traditional operators now adopting cloud architectures has permanently changed supplier R&D priorities.”

The Cignal AI Optical Customer Markets Report is issued quarterly and quantifies optical equipment sales to five key customer markets: Incumbent, Wholesale, Cloud and Colo, Cable/MSO, and Enterprise and Government.

The latest report is now enhanced and includes optical equipment vendor market share for all customer markets as well as updated forecasts through 2023.

Additional findings in the 1Q19 Optical Customer Markets Report include:

  • Ciena Waveserver Ai market share continues to increase as cloud & colo spending grows. New compact modular platforms targeted at this market are entering the market in 2Q19 with Cisco, Infinera, and Nokia among those expecting stronger sales in the next quarter.
  • North American cable/MSO spending declined in the first quarter. However, moderate growth is still expected in 2019.
  • Enterprise and Government spending shows pressure from consolidation and Cloud and Colo encroachment and isn’t expected to recover in the next two years.

About the Optical Customer Markets Report:

The Cignal AI Optical Customer Markets Report tracks optical equipment spending by end customer market type. It provides forecasts based on expected spending trends by regional basis. The report includes revenue-based market size and share for all end customer markets across all regions.

Vendors examined include Adtran, ADVA, Ciena, Cisco, ECI, Ekinops, Fiberhome, Fujitsu Networks, Huawei, Infinera, Juniper Networks, Mitsubishi Electric, MRV, NEC, Nokia, Padtec, TE Conn, Tejas Networks, Xtera and ZTE.

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About Cignal AI:

Cignal AI provides active and insightful market research for the networking component and equipment market and the market’s end customers. Our work blends expertise from a variety of disciplines to create a uniquely informed perspective on the evolution of networking communications.

To purchase the report contact:  sales@cignal.ai

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July 25, 2019 Update-CignalAI comments on Cisco-Acacia:

Two weeks ago, Cisco announced it was acquiring Acacia, a move that could transform the company into a market leader in a new era of pluggable coherent optics and disaggregated networks. Cisco was already a growing customer for Acacia and was poised to be one of the leading consumers of Acacia’s AC1200 module that is now reaching the market. Between Cisco’s previous Luxtera acquisition for short-reach optical technology and its current addition of Acacia for long reach coherent, the company will have deep vertical integration.

1Q19-MA-1

Compact modular optical hardware is being used in more network applications than ever before, driving up sales during the first quarter of 2019 as reported in the latest Optical Applications Report. Worldwide, compact modular hardware sales are tracking to exceed $1 billion in revenue this year.

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Separately, CenturyLink says it has completed the first of a two-phase build out that will see its fiber-optic networks in the U.S. and Europe grow by 4.7 million fiber miles. The new fiber infrastructure leverages ultra-low-loss fiber from Corning (NYSE: GLW) and will support businesses, government agencies, and other service providers who want access to fiber.

The first phase, completed in June, addressed CenturyLink’s U.S. requirements and connected more than 50 cities via 3.5 million new fiber miles. The European work, slated to finish in the first part of 2021, will see 1.2 million fiber miles installed. Both deployments leverage CenturyLink’s multi-conduit infrastructure, which the company says enables quick and economical fiber deploy and capacity expansion.

CenturyLink's expanded fiber network connects more than 50 locations in the U.S.

CenturyLink’s expanded fiber network connects more than 50 locations in the U.S. Image courtesy of Century Link

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“Our newly built intercity fiber network, created with the latest optical technology, is another example of how our diverse fiber assets differentiate us from other network providers,” said Andrew Dugan, CenturyLink chief technology officer. “Our multi-conduit infrastructure has a significant amount of capacity for supporting the growing demand for fiber and will allow us to quickly and cost effectively deploy new fiber technology now and in the future. This uniquely positions CenturyLink to meet the needs of companies seeking highly reliable, low-latency network infrastructure designed to move massive amounts of data.”

CenturyLink was able to quickly and cost effectively complete the first phase of the project using multi-conduit infrastructure already in place. The company is currently selling routes to large enterprise companies and content providers in the U.S. and will work with customers to add additional routes as needed.

Key Facts:

  • CenturyLink is creating an extensive 4.7-million fiber mile intercity fiber network across the U.S. and parts of Europe.
  • The first phase, comprising 3.5 million fiber miles, was completed in June. An additional 1.2 million fiber miles will be added by early 2021.
  • CenturyLink is currently selling fiber routes to large enterprise companies and content providers in the U.S.
  • Multi-conduit infrastructure allows CenturyLink to quickly and economically deploy new fiber technology or add network capacity as needed.
  • The investments in the first phase of the fiber upgrade are included in CenturyLink’s full year 2019 capital expenditure outlook.
  • The expanded fiber network utilizes Corning’s SMF-28® ULL fiber and SMF-28® Ultra fiber, creating the largest ultra-low-loss fiber network in North America.

References:

http://news.centurylink.com/2019-07-23-CenturyLink-Expands-Fiber-Network-Across-U-S-and-Europe

https://www.lightwaveonline.com/network-design/high-speed-networks/article/14036681/centurylink-adding-47-million-fiber-miles-to-us-european-fiberoptic-networks

Cignal AI: Modular Optical Sales Expand, Reaching Over $275M

Almost 30% of North American Optical Hardware Shipments Now in Compact Modular Format

by Cignal AI staff

Compact modular optical hardware is being used in more network applications than ever before, driving up sales during the first quarter of 2019 as reported in the latest Optical Applications Report from market research firm Cignal AI.

Compact modular optical systems were first used by cloud operators for data center interconnect applications but have since expanded well beyond into many other operators and applications. Market share leaders include the Ciena Waveserver, Infinera CX and Groove, and Cisco 1000 series.

The report illustrates significant growth throughout most regions as the compact modular customer base expands beyond cloud and webscale operators to include traditional telco customers pursuing network disaggregation. Compact modular hardware sales exceeded $275 million in Q1 and are tracking to exceed $1 billion in revenue this year. Growth was most pronounced in North America this quarter, where it accounted for almost 30% of the entire optical market and is expected to continue advancing through 2023.

“Network applications for the compact modular form factor have expanded well beyond the original data center interconnect deployments,” said Scott Wilkinson, Lead Analyst for Optical Hardware at Cignal AI. “Applications now include traditional telco networks, metro and long haul deployments, and even some early trials for subsea deployment. We expect this spending trend to increase in 2019 as new compact modular products come to market from a variety of vendors.”

Cignal AI’s 1Q19 Optical Applications Report details market share for the first quarter of 2019 and provides forecasts in three key markets: compact modular equipment, advanced packet-OTN switching hardware, and 100Gbps+ coherent WDM port shipments across multiple speeds. Hardware and coherent port shipments are forecasted through 2023. The Applications Report is issued quarterly.

Additional 1Q19 Applications Report Key Findings:

Ciena expanded its dominance in compact modular with over 50% market share in Q1. The combined Infinera/Coriant held on to second place despite declining sales.

Acacia [1] AC1200-based platforms are expected to have an impact starting next quarter. Cisco (which is acquiring Acacia) compact modular sales paused in Q1 in anticipation of the NCS1004 platform.

Note 1.  Cisco and Acacia Communications entered into a definitive agreement under which Cisco has agreed to acquire Acacia for a consideration of US$2.6 billion.

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Almost 500k physical coherent ports have shipped in the last 12 months. Currently, over 70% of coherent ports are shipped by the top five vendors in the market.

After a 2018 recovery year, long haul port shipments are starting to pick up. Metro growth is advancing at a similar pace, as next-generation coherent enables an upgrade from 100Gbps.

Packet OTN growth is slowing. New deployments are limited to China and parts of APAC as networks in other regions evolve away from the packet OTN architecture.

About the Optical Applications Report:

The Cignal AI Optical Applications Report includes market share and forecasts for revenue and port shipments for optical equipment designed to meet the needs of specific applications: 100G+ coherent, and compact modular and advanced packet-OTN switching hardware.

Vendors examined include Acacia, Adtran, ADVA, Ciena, Cisco, ECI, Ekinops, Fiberhome, Fujitsu, Huawei, Infinera, Inphi, NEC, Nokia, NTT Electronics (NEL), Padtec, Tejas, Xtera and ZTE.

Deliverables include Excel files with complete data sets, PowerPoint summaries and Cignal AI’s Active Insight news reporting. Cignal AI clients with Applications report subscriptions may access this material on the Cignal AI website.

About Cignal AI:

Cignal AI provides active and insightful market research for the networking component and equipment market and the market’s end customers. Our work blends expertise from a variety of disciplines to create a uniquely informed perspective on the evolution of networking communications.

Contact Us/Purchase Report: 

Sales: sales@cignal.ai
Web: Contact us

Cignal AI: Japan’s Optical Hardware Growth Soars in 1Q2019; North America Remains Weak

by Scott Wilkinson and Andrew Schmitt of Cignal AI (edited by Alan J Weissberger)

Metro Bandwidth Growth Outpaces Long Haul; North America Remains Weak

Japan continued its recent hot streak as 1Q2019 marked the fourth quarter in a row of growth with an extraordinary 82% increase, according to the most recent (1Q2019) Optical Hardware Report from research firm Cignal AI.  Japan registered an extraordinary 82% year-over-year increase in optical networking hardware sales in the first quarter of 2019.  Prime beneficiaries were domestic suppliers NEC, Mitsubishi and Fujitsu along with Ciena and Nokia, all of which posted significant gains during the quarter.

“The exceptional optical market growth in Japan is the story to watch for 2019,” said Scott Wilkinson, Lead Analyst for Optical Hardware at Cignal AI. “Network operators have begun significant network rebuilds and expansions, and domestic as well as non-Japanese vendors continue to grow sales in the region at remarkable rates.”

 

 

North American growth continued to disappoint as slow optical hardware spending among traditional telco operators obscured growth in sales to cloud and colo operators (e.g. multi-tenant data centers).

Additional key findings in the 1Q19 Optical Hardware Report:

  • Metro Bandwidth Outpaces Long Haul – While long haul spending grew at a higher rate than metro, analysis reveals that metro bandwidth is growing more rapidly.
  • Growth in China Decelerates – Growth in China moderated into the single-digits during 1Q19, as 2018’s high spending by Chinese carriers could not continue indefinitely.
  • EMEA Posted Solid Gains – Both metro and long haul spending grew during the quarter, with growth led by both traditional and cloud & colo operators.
  • CALA Continues Lackluster Performance –Q1 showed no improvement for the region. Relief may be coming, as vendors believe major carriers in the region will return to spending later this year.

Cignal AI’s Optical Hardware Report is issued each quarter and examines optical equipment revenue across all regions and equipment types. The analysis is based on financial results, independent research, and guidance from individual equipment companies. Forecasts are based on overall spending trends for equipment types within the regions.

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Cignal AI’s interactive Optical Hardware Superdashboard is available to clients of the Optical Hardware Report and provides up-to-date market data for real-time visibility on individual vendors’ results. Users can manipulate data online and see information in a variety of useful ways.

About the Optical Hardware Report

The Cignal AI Optical Hardware Report is published quarterly and includes market share and forecasts for optical transport hardware used in optical networks worldwide. In addition to the interactive tracker, the analysis includes an Excel database as well as PDF and PowerPoint summaries. Subscribers to the Optical Hardware Report also have access to Active Insight, Cignal AI’s real-time news service on current market events.

The report examines revenue for metro WDM, long-haul WDM and submarine (SLTE) equipment in six global regions and includes detailed port shipments by speed. Vendors in the report include Adtran, ADVA, Ciena, Cisco, ECI, Ekinops, Fiberhome, Fujitsu, Huawei, Infinera, Mitsubishi Electric, NEC, Nokia, Padtec, Tejas, Xtera, and ZTE.

Full report details, as well as articles and presentations, are available on the Cignal AI website.

About Cignal AI

Cignal AI provides active and insightful market research for the networking component and equipment market and the market’s end customers. Our work blends expertise from a variety of disciplines to create a uniquely informed perspective on the evolution of networking communications.

Optical Hardware Spending Growth Surges Over 80% in Japan

Cignal AI: Record Spending on Cloud Operator Optical Networks Drives Growth in 2018

 

Cignal AI: Record Spending on Cloud Operator Optical Networks Drives Growth in 2018

by Andrew Schmitt and Scott Wilkinson of Cignal AI

Cloud operator spending on optical hardware grew almost 50 percent year-over-year to reach well over over $1 billion in 2018, according to the most recent (4Q18) Optical Customer Markets Report from research firm Cignal AI.

“Cloud network operators such as Google and Microsoft were the only customers in the optical market to exhibit significant spending growth last year” said Scott Wilkinson, Optical Hardware Lead Analyst for Cignal AI. “While still the largest segment overall, incumbent spending on optical hardware was down last year, particularly in North America.”

Optical Ahrdware SPending Trends by Customer Market 4Q18 North America
The Cignal AI Optical Customer Markets Report is issued quarterly and quantifies optical equipment sales to five key customer markets: incumbent, cloud and colo, wholesale, cable MSO, and enterprise and government. Findings from the current report – including market size, forecasts by regions and optical hardware vendor market share – will be examined via a webinar on Tuesday, April 23 at 11 a.m. EDT, which is open to all report clients.

Key findings in 4Q18 Optical Customer Markets Report:

  • Cloud operators remain the fastest-growing segment – North American cloud operators spent nearly as much on optical hardware as incumbents such as AT&T and Verizon in Q4.  New builds drove growth in EMEA, making cloud and colo the fastest-growing worldwide customer segment in 2018.
  • Ciena extends market lead among cloud operators –Ciena supplied over a third of the global market and doubled its lead over its nearest competitor. Others in the top five include Cisco, Huawei, Nokia and Infinera.
  • Incumbent spending growth will remain in low single digits through 2023 – While incumbents still purchase most optical hardware, their spending is static when compared with new network operators. Updated forecasts indicate a decline ahead in North American incumbent spending.
  • Cable/MSO and Wholesale Operators Decelerate Spending – Spending growth by cable/MSO operators was weak and market consolidation resulted in slowing wholesale optical network deployments.

The 4Q18 Optical Customer Market Report includes current quarter and full year 2018 optical sales for all tracked vertical markets. The report also includes optical equipment vendor market share for sales to cloud and colo operators, as well as updated customer market forecasts through 2023.

About the Optical Customer Markets Report

The Cignal AI Optical Customer Markets Report tracks optical equipment spending by end customer market type. It provides forecasts based on expected spending trends by regional basis. The report includes revenue-based market size for all end customer markets across all regions, with market share for sales to the cloud and colo segment broken out on a worldwide basis.

Vendors examined include Adtran, ADVA, Ciena, Cisco, Cyan, ECI, Ekinops, Fiberhome, Fujitsu Networks, Huawei, Infinera, Juniper Networks, Mitsubishi Electric, MRV, NEC, Nokia, Padtec, TE Conn, Tejas Networks, Transmode, Xtera and ZTE.

Quarterly report deliverables include an Excel file with complete data set, PowerPoint summary of highlights and Cignal AI Active Insight market event news briefs. Full report details, as well as free articles and presentations, are available on the Cignal AI website.

About Cignal AI

Cignal AI provides active and insightful market research for the networking component and equipment market and the market’s end customers. Our work blends expertise from a variety of disciplines to create a uniquely informed perspective on the evolution of networking communications.

Contact Cignal AI/Purchase Report

Sales: sales@cignal.ai
Web: Contact us
Link to Release

Cignal AI: Long-Haul WDM Deployment Growth Sets Stage for Increased Spending in 2019

After a weak 2017, long-haul WDM deployments rebounded in the fourth quarter of 2018 (4Q18) with growth of nearly 20 percent; bringing it up almost 8 percent for the year, according to the 4Q18 Optical Hardware Report from research firm Cignal AI. Growth was fueled by a reversal of almost two years of terrestrial spending decline in North America and a year-over-year surge in Japan.

“There have been several announcements of next-generation coherent optical system deployments leading up to this week’s OFC conference, and more are expected before the event concludes,” said Scott Wilkinson, Optical Hardware Lead Analyst at Cignal AI. “These new generations of coherent optical hardware will spur long-haul and SLTE spending increases, which we expect will continue into next year.”

Cignal AI’s Optical Hardware Report is issued each quarter and examines optical equipment revenue across all regions and equipment types. The analysis is based on financial results, shipment information, and guidance from individual equipment companies. Forecasts are based on overall spending trends for equipment types within the regions.

Key findings in 4Q18 Optical Hardware Report:

  • North America Rebounds – After eight quarters of declining revenue, North American terrestrial spending (excluding SLTE) turned positive in 4Q18, led by long haul and cloud & colo spending. Ciena saw double-digit growth in the region and was responsible for most of the turnaround, with ADVA posting a similar growth percentage. While 2018 was down year over year, modest growth is predicted for 2019.
  • Japan Posts Impressive Returns – A stronger-than-expected third quarter combined with a 4Q18 surge resulted in regional growth of nearly 45 percent year-over-year, led entirely by non-Japanese vendors. Nokia, Ciena and Huawei posted larger gains at the expense of traditional Japanese vendors Fujitsu, Mitsubishi and NEC. While spending was up double-digits in 2018, it is expected to normalize to single-digit growth for 2019.
  • EMEA Quarterly Spending Lags – Traditional EMEA fourth-quarter spending growth was not as large in 2018 as compared to previous years, resulting in a quarterly YoY decline. For the year, EMEA is up slightly and should grow well into 2019.
  • China Experiences Slowdown – Growth in China continued in 4Q18 but decelerated as more moderate growth becomes the new norm as large percentage gains cannot be sustained indefinitely. Nokia had a strong quarter, though Chinese sales are still dominated by the local vendors such as Huawei and ZTE. The loss of ZTE revenue in the 2Q18, however, resulted in flat Chinese spending for the year. Single-digit growth is expected into 2019.
  • CALA Returns to Growth – Recovering from a negative third quarter, CALA had a small increase in 4Q18. The region remained down in double-digits for the year.

 Interactive Optical Hardware Market Share Tracker

 In mid-2018, Cignal AI launched its Optical Hardware Market Share Tracker, which presents the quarter’s up-to-date market data, providing real-time visibility on individual vendors’ results as soon as they are reported to enable well-informed market analysis. With the 4Q18 results, Cignal AI debuted a new, interactive format that enables users to manipulate data online and see information in a variety of useful ways. The interactive Market Share Tracker is available to clients of the Optical Hardware Report.

About the Optical Hardware Report

The Cignal AI Optical Hardware Report is published quarterly and includes market share and forecasts for optical transport hardware used in optical networks worldwide. In addition to the interactive tracker, analysis includes an Excel database as well as PDF and PowerPoint summaries. Subscribers to the Optical Hardware Report also have access to Active Insight, Cignal AI’s real-time news service on current market events.

The report examines revenue for metro WDM, long-haul WDM and submarine (SLTE) equipment in six global regions and includes detailed port shipments by speed. Vendors in the report include Adtran, ADVA, Ciena, Cisco, Coriant, ECI, Ekinops, Fiberhome, Fujitsu, Huawei, Infinera, Juniper Networks, Mitsubishi Electric, MRV, NEC, Nokia, Padtec, Tejas, Xtera and ZTE.

Full report details, as well as articles and presentations, are available on the Cignal AI website.

About Cignal AI

Cignal AI provides active and insightful market research for the networking component and equipment market and the market’s end customers. Our work blends expertise from a variety of disciplines to create a uniquely informed perspective on the evolution of networking communications.

sales@cignal.ai
Web: Contact us

OFC 2019: Importance of Software and 5G Related Sessions

As optical networking evolves, industry changes emphasize the increasing importance of software in optical communications. Today’s software research extends beyond SDN/NFV to address control and optimization of transmission systems, network planning, and device design, and OFC’s Demo Zone picks up on this trend.

“OFC allows to us explore the latest software developments and discuss emerging trends,” said Laurent Schares, IBM Research, USA, an OFC 2019 general chair. “Now is the time to address operational strategies, use cases and field deployments — and demonstrations drive that point home.”

OFC 2019 expanded this year’s Demo Zone to reflect industry evolution. The Demo Zone will feature live demonstrations of key software functions and tools for optical communication devices, systems and networks. From AI engine cooperation to an open dis-aggregated transport network and beyond, the OFC Demo Zone addresses topics of coordination and collaboration between systems and organizations. These proof-of-concept and research demonstrations offer an opportunity for small group, interactive dialogue, featuring real-time exchanges between attendees and presenters.

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5G related symposia at OFC 2019:

5G Trials, Pilots, and Demonstrations, Monday, 4 March, 08:00 – 16:00

Organizers: Thomas Pfeiffer, Nokia Bell Labs, Germany; Jun Terada, NTT, Japan; Shan Wey, ZTE, USA

The fifth generation mobile networks (5G) have promised to transform mobile broadband services through a new network architecture that will enable significantly faster access speed, ultra-reliable low latency communications, and massive machine-to-machine communications, not only for mission critical applications but for everyone everywhere. As the industry is progressing towards 5G standards and 5G capable technologies, the deployment of 5G networks is about to become reality as evidenced by the flood of new product announcements and field trial reports by network operators.

This symposium is intended to update the OFC community about the latest progress of 5G trials, pilots, and demonstrations. Use case scenarios involving a wide range of relevant vertical sectors, e.g., mobile broadband access, connected transport, digital health, smart cities/venues, creative media, will be discussed. By reporting on recent progress, we hope to highlight the role of photonic technologies in delivering 5G network solutions and further inspire and challenge the photonics industry to advance developments targeting the future mobile communication networks.

The symposium is divided into three sessions. The first session will focus on 5G requirements and how major system vendors will realize x-haul transport over optical systems. The second session will provide insight into the perspectives and first experiences of leading telecom network operators and industrial players using 5G technologies. The third session finally will showcase future applications and field trials related to public sector initiatives.

Session 1 – 5G Trials: Vendor’s Perspective
Monday, 4 March, 08:00 – 10:00

Francis Dominique, Nokia, USA
Requirements of 5G Radio Netwoks on Optical X-haul Transport

The high data rate and very low latency applications supported by 5G require an appropriate transport network to meet the requirements of these applications. This paper provides an insight to the requirements imposed by 5G radio access networks (RAN) on front/midhaul transport.

Li Mo, ZTE, China
ZTE’s 5G Trials

Stefano Stracca, Ericsson, Italy
Network Convergence in 5G Transport

Soundarakumar Masilamani, C-DOT, India
5G Rural Strategy in India

Session 2 – 5G Trials: Network Operators’ and Vertical Industries’ Perspective
Monday, 4 March, 10:30 – 12:30

Kent McCammon, AT&T, USA
Recent Progress of AT&T’s 5G Trials

Yukihiko Okumura, NTT DoCoMo, Japan
5G Trials in Japan

Walid Mathlouthi, Google, USA
Regulatory Aspects for 5G to Enable New Business Models

Yuji Inoue, Toyota InfoTechnology Center, Japan
Industry 4.0

Session 3 – 5G Trials: Public Sector Initiatives
Monday, 4 March, 14:00 – 16:00

Dimitra Simeonidou, University of Bristol, UK
Test Bed and Trials for 5G Content Delivery in England

Harald Haas, University of Edinburgh, UK
5G Rural Trials in Scotland

Dan Kilper, COSMOS-PAWR, USA
COSMOS: An Advanced Optical and Wireless Networking Testbed in NYC

Moises Ribeiro, Universidade Federal do Espírito Santo, Brazil
5G Research and Testbeds in Brazil

https://www.ofcconference.org/en-us/home/program-speakers/symposia/

IHS Markit: Ciena tops the list of optical equipment vendors + Cignal AI’s OFC Preview

By Heidi Adams, executive director, network infrastructure, IHS Markit

Each year IHS Markit surveys service providers, in order to find out which companies they view as the leaders of the optical equipment market. The survey also explores their perceptions of vendors in key decision metrics, like pricing, total cost of ownership, technology innovation, research-and-development (R&D) investment, and product reliability.

Following are some of the key findings from this year’s survey:

Optical equipment vendor leaders:

In brand awareness, respondents perceive Ciena, Huawei, and Nokia as the overall leaders for optical transmission and switching equipment in 2018, with no change in the rankings from last year. These results are well aligned with positioning in the global optical network hardware market in the first three quarters of 2018, where Huawei, Ciena, and Nokia were ranked as the top three vendors by market share in this period.

Ciena was the most cited leader in optical DCI, with Huawei and Infinera tied for second place. Ciena also made significant strides this year in market perception for leadership in optical disaggregation, rising from third position in our 2017 survey to first-ranked position in 2018. Coriant (now Infinera), Huawei and Nokia all tied for second place.

Purchasing criteria:

IHS Markit survey respondents were also asked to identify the leaders in purchasing criteria, including pricing, technology innovation, product reliability, service and support and investment in research and development. The top three vendor selection criteria for optical equipment purchasing decisions in 2018 were, as follows:

  1. Product reliability
  2. Pricing
  3. Total cost of ownership

Ciena was the leader in 2018 for service provider perception of vendor leadership in product reliability, technology innovation, management software, and investment in research and development. Huawei topped the list for service provider perception of vendor leadership in pricing, total cost of ownership, solution breadth, and financial stability. Nokia was perceived as the leader in service and support for optical networks.

Optical Equipment Vendor Leadership Service Provider Survey – 2018

This survey explores how service providers evaluate and select optical transmission and switching equipment suppliers. It covers vendors installed and under evaluation and service provider opinions of vendors, including on key vendor selection criteria.

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Cignal AI on OFC 2019–

400ZR Steals the Show:

No single topic at OFC will command as much attention as 400ZR, which is based on fourth-generation coherent technology and an OIF standard for coherent short reach DCI applications. Product development is well underway with over a dozen component and equipment companies spending in excess of $300M in this effort. The market for short reach coherent extends well beyond the DCI needs of Microsoft and Google. Derivatives (known as ZR+ or ZR plus) are emerging which are designed to meet the broader needs of network operators everywhere. ZR is the first coherent technology that will be both standardized and pluggable, and the emergence of ZR products will shake up the optical equipment landscape. One major impact is that 10G WDM will become obsolete in its only remaining stronghold- the edge of the optical network. The greater question is what role standalone optical hardware will play in the network as the performance and interoperability of coherent pluggables improve. Expect a cascade of activity at OFC from component and equipment companies as they uncover their ZR plans and demonstrate the latest optical engines, and some bombshell announcements and partnerships from the leaders in this space – Inphi, Acacia, Ciena, Cisco, Huawei, Nokia, and NTT Electronics.

While fourth-generation 400G products have been announced at OFC already for the last two years, 2019 is the year that these products start deploying for revenue. Starting in early 2019, third generation solutions from Acacia (via multiple hardware vendors), Nokia, Huawei, Fujitsu, and Infinera will join Ciena in live network deployments. Now that 400G is deployed, there will be multiple roadmap announcements at OFC seeking to leapfrog 400G and propose the next generation of coherent optical speeds. 600G is a given, but there will be 800G and perhaps 1Tbps announcements as well. Components suppliers and equipment manufacturers will show roadmaps to higher speed sixthgeneration coherent optical components in preparation for a 2020 introduction.

We expect Infinera to disclose more detail on its ICE6 R&D efforts and would not be surprised to hear Ciena talk about a successor to the Wavelogic AI now that competitive products are arriving in the market.

Disaggregation Continues, with Many Definitions: 

The disaggregation trend will continue to gain strength at OFC, but the definition will continue to change. Whereas the original concept was complete separation of switching transponders, ROADMs, and perhaps even components into separately manageable elements, now new solutions are starting to look more like traditional optical equipment. Compact modular systems, which are the most visible components of a disaggregation strategy, have moved from monolithic transponder or open line systems to more complex devices that can include switching and multiple functions in the same shelf. Some systems now even have modularity via cards (although they are called “sleds” rather than “cards”), making them look more like traditional systems in everything but physical dimensions. Several large operators are skeptical about disaggregation, while several others agree with the concept but consider current solutions too difficult to manage. Regardless, the industry-wide shift to disaggregation will accelerate as implementation becomes easier and better attuned to the needs of a wider variety of customers. General availability and customer announcements for 2019 are expected from several vendors, including ADVA, Cisco, Coriant, Fujitsu, and Nokia. In addition to the compact modular announcements,

Cignal AI Raises Forecast for Asia Optical Hardware Market while NA declined for 8th consecutive quarter

Optical hardware sales throughout Asia surged in 3Q18, fueled by double digit increases in China and Japan, and a turnaround in India, according to the third quarter 2018 (3Q18) Optical Hardware Report from research firm Cignal AI. With strong momentum expected to continue, we raised our estimates for Asia.

North America continued to decline for the eighth consecutive quarter, as weakness in the traditional operator market was not offset by strong sales to cloud and color operators.

“China bounced back more quickly than expected following the ZTE shutdown, and outside vendors Nokia and Ciena saw a triple-digit increase in Japan during the third quarter,” said Scott Wilkinson, lead analyst, Optical Hardware for Cignal AI. “RoAPAC contributed to the success in Asia as well. While we expected a slight slowdown this year there will likely be net increases for the year, driven largely by sales in India.”

Other findings in the 3Q18 Optical Hardware Report;

  • Ciena was the only vendor among the top 5 that grew revenue in North America, thanks to sales to cloud and colo operators.
  • EMEA saw double-digit growth during the quarter, and this momentum is anticipated to continue given traditional fourth-quarter spending increases.
  • An expected turnaround in CALA did not materialize, as spending in the region continued to decline.

Optical Vendor Summary Reports

A new feature of the Optical Hardware Report this quarter are Optical Vendor Summary Reports which examine in depth the most recent quarterly results and items of interest about vendors in the optical market. Reports this quarter cover ADVACienaFujitsuHuaweiInfinera/Coriant and Nokia.

About the Optical Hardware Report

The Cignal AI Optical Hardware Report is published quarterly and includes market share and forecasts for optical transport hardware used in optical networks worldwide. The analysis includes an Excel database as well as PDF and PowerPoint summaries. Subscribers to the Optical Hardware Report also have access to Cignal AI’s real-time news briefs on current market events, Active Insight.

The report examines revenue for metro WDM, long-haul WDM and submarine (SLTE) equipment in six global regions and includes detailed port shipments by speed. Vendors in the report include Adtran, ADVA, Ciena, Cisco, Coriant, ECI, Ekinops, Fiberhome, Fujitsu, Huawei, Infinera, Juniper Networks, Mitsubishi Electric, MRV, NEC, Nokia, Padtec, Tejas, Xtera and ZTE.

Full report details, as well as articles and presentations, are available on the Cignal AI website.

 

IHS Markit: Data Center Interconnect (DCI) is Fastest-growing Application for Optical Networking

A significant driver for innovation in the optical market, data center interconnect (DCI) is the fastest-growing application for optical networking equipment, according to a new study from business information provider IHS Markit. Eighty-six percent of service providers polled for the Optical Network Applications Survey have plans to support DCI applications in their networks.

“Data center interconnect is enjoying a meteoric rise as the hottest segment in the optical networking applications space,” said Heidi Adams, senior research director for transport networks at IHS Markit. “Service providers are becoming increasingly invested in the DCI market, both for providing interconnect between their own data centers and for offering DCI services to internet content providers and enterprises. We estimate that service providers will account for around half of all DCI equipment spending in 2018.”

The optical data center equipment market reached $1.4 billion in sales in the first half of 2018, posting 19 percent year-over-year growth, according to IHS Markit. A key driver of the market is the compact DCI sub segment, which notched a 173 percent growth rate during this same time period.

“‘Compact’ DCI equipment is designed to fit within a data center environment from the form factor, power consumption and operational perspectives,” Adams said. “It’s optimized to meet the requirements of internet content providers like Google, AWS, Facebook, Microsoft and Apple.”

The top three vendors in the compact DCI sub segment are Ciena, Infinera and Cisco, who collectively account for three-quarters of the market.

Additional DCI highlights

  • Cost per port is the leading criterion among survey respondents for the selection of equipment for DCI applications.
  • 100G is the main currency for line-side DCI interfaces in 2018, declining in favor of 400G by 2021.
  • IHS Markit forecasts the total DCI market to grow at a 15 percent compound annual growth rate (CAGR) from 2017 to 2022, representing a higher rate of growth than the overall WDM market.

Optical Network Applications Service Provider Survey – 2018

This survey analyzes the trends and assesses the needs of service providers using emerging optical networking architectures. It covers data center interconnect, packet-optical equipment and software-defined networking for transport networks. For the survey, IHS Markit interviewed 22 service providers who have deployed packet-optical transport, optical DCI and/or transport SDNs or will do so in the future.

DCI, Packet-Optical & OTN Equipment Market Tracker

This biannual report provides worldwide and regional vendor market share, market size, forecasts through 2022, analysis and trends for data center interconnect equipment, packet-optical transport systems, and OTN transport and switching hardware.

Reference:

https://www.ciena.com/insights/what-is/What-is-DCI.html

 

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