Optical Transceiver Industry Evolves to Meet Current Economic Challenges

EUGENE, OR--(Marketwire - June 1, 2009) - The optical transceiver industry will contract in 2009, remain flat through 2010, but gain momentum in 2011-2012, fueled by investments in networking infrastructure, according to the latest State of the Industry Report from LightCounting, the premier optical transceiver company. Sales of the top ten vendors accounted for 85% in 2008, up from 79% in 2007, led by market share gains of the top three suppliers. This trend is likely to continue, as customers are unwilling to risk dealing with smaller suppliers during a recession.

The average gross margin of leading vendors remains at 25%, well below the 40-60% margins commonly maintained by optical equipment manufacturers and service providers. Increasing profitability remains the primary objective of the optical transceiver industry. Diversification into different market segments, customer types and geographic regions is critical for emerging from the recession. Well-diversified vendors are likely to solidify their market positions in 2009-2010 and enjoy increasing profitability in 2011-2012.

"Doing business in the current economic environment will be difficult for all and probably impossible for some vendors," says Vladimir Kozlov, Founder, LightCounting. "Those strong enough to survive will be more well-rounded, better able to reap the rewards of healthier profit margins, and more capable of serving an increasingly demanding global marketplace."

This report examines the state of the opto-electronic transceiver industry, covering industry dynamics in market segments including SONET/SDH, Ethernet, Fibre Channel, WDM, FTTx, and Optical Interconnects. Leading transceiver vendors shared confidential data that enabled an in-depth analysis of the industry's health. The report reveals the profitability, industry share and diversification of transceiver vendors and their customers and key suppliers.

About LightCounting

LightCounting is the premier opto-electronic transceiver market research company, offering transceiver market survey results and forecasts based on confidential, detailed data provided by more than 25 leading transceiver vendors. LightCounting's reports enable business executives, engineering, manufacturing, and sales/marketing professionals to plan business strategies using objective market information rather than speculative assumptions. Providing Semiannual Transceiver Sales Reports and Market Forecast Updates with Annual State of the Industry Reports, Technology Reviews and Tradeshow Reports, LightCounting is the opto-electronic transceiver market's information source.

Privately held, LightCounting is headquartered in Eugene, Oregon, with offices in Silicon Valley. For more information: www.LightCounting.com or 408.962.4851.

To purchase LightCounting Reports, please contact Megan Andreosky, megan@lightcounting.com.