The Global Optical Communication Industry Still Holds an Upside Potential for Component Suppliers, Despite a Modest 10% Growth in Sales Projected for 2012

Latest Forecast Database Released by LightCounting Covers Ethernet, Fibre Channel, SONET/SDH, WDM, and FTTx Optical Transceiver Markets, as Well as Projections for Sales of Wavelength Selective Switches (WSS), Tunable Lasers, Active Optical Cables (AOCs) and Embedded Optical Modules (EOMs)


EUGENE, OR--(Marketwire - Jul 10, 2012) - Sales of optical components and modules are projected to ramp up 10% in 2012, after increasing by 17% and 36% in 2011 and 2010, respectively. Among the major segments, Ethernet, DWDM and FTTx markets will lead the growth in 2012 and beyond. Emerging market opportunities for AOCs and EOMs offer additional streams of revenues for component suppliers in 2012-2016. A detailed market forecast, including analysis of leading service providers and equipment manufacturers, is available in a new report titled "Optical Communications Market Forecast: Do Not Give Up on the Optical Networking Industry" (http://www.lightcounting.com/June2012_Forecast.cfm).

According to the latest data collected by LightCounting, sales of FTTx modules grew the fastest in 2011, increasing 70% for the year. The sharp increase in shipments of PON transceivers for FTTH deployments in China, directly supported by the government, accounted for most of this growth. Many privately held Chinese suppliers of PON components and modules benefited from this opportunity in 2011 and are expecting a 20-30% increase in 2012 sales. These suppliers are among numerous Chinese companies profiled in the recently published State of the Industry report (http://www.lightcounting.com/2012_SOTIR.cfm).

"Very strong growth in the FTTx market is directly related to investment decisions made by the Chinese government, so this market is difficult to forecast. An economic slowdown may provide another boost to this market via stimulus funding offered by the government," commented Vladimir Kozlov, founder and CEO of LightCounting. "Demand for optics in the global telecom networks and datacenters is correlated with growth in Internet traffic and is more predictable. However, these markets are prone to fluctuations. Apart from general economic sentiment impacting investments into networking infrastructure, a small 5-7% increase in projected growth of Internet traffic could lead to 40-50% jump in demand for optical components and modules."

The Forecast report offers a steady-state scenario for the market growth and discusses potential impacts of an economic slowdown or change in the Internet traffic growth rate. Even in the conservative steady-state scenario, sales of Ethernet and DWDM components and modules are expected to increase at around 15% CAGR in 2012-2016. Growth in other major market segments will be below 10% CAGR in the same period, but emerging markets for AOCs and EOMs are well positioned to grow much faster (http://www.lightcounting.com/activeoptical_2012.cfm; http://www.lightcounting.com/EOM.cfm).

The Forecast report presents analysis of business and CapEx of the top 12 service providers, as well as trends in the networking equipment market and business of leading equipment manufacturers. The report also offers a detailed forecast for optical components and modules, including historical data from 2008 to 2011, and a detailed market forecast through 2016 for optical components and modules used in Ethernet, Fibre Channel, SONET/SDH, CWDM/DWDM, wireless infrastructure, FTTx, and high-performance computing (HPC) applications. The sales data for 2008 to 2011 account for more than 30 transceiver vendors, including 25 vendors that shared confidential sales data with LightCounting. The market forecast for 2012-2016 is based on LightCounting's model correlating transceiver sales with network traffic growth and projected subscribers of FTTx systems. 

About LightCounting:
LightCounting, LLC, is a leading optical communications market research company, offering semiannual market update, forecast, and state of the industry reports based on analysis of publicly available information and confidential data provided by more 20 leading module and component vendors. LightCounting is the optical communications market's source for accurate, detailed, and relevant information necessary for doing business in today's highly competitive market environment. Privately held, LightCounting is headquartered in Eugene, Oregon. For more information, go to http://www.LightCounting.com, or follow us on Twitter at http://www.twitter.com/lightcounting.