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Optical network components avoid sales bubble

By Donna Donnawitz
March 7, 2012
The optical network components sector managed to avoid experiencing a sales bubble when slow sales during the first quarter of 2011 was followed by solid growth throughout the year.

According to a recent LightCounting study, the optical component market expanded by an impressive 36 percent during 2010. When growth occurs at such a rapid pace, economic experts begin to worry that the industry may hit a market bubble and face a sharp decline during the following year. During the early parts of 2011, those concerns were fueled by slow sales. Then something in the market shifted, revenues picked up again and optical components escaped the economic bubble and made their way into the tournament of emerging networking technologies that are rising fast.

By the time 2011 reached its conclusion, the optical components market had expanded by 7 percent, a significant decline from 2010, but still noteworthy growth in its own right.

Vladimir Kozlov, founder and CEO of LightCounting, explained that the high-end optical transceiver market experienced slow growth during the year, but not necessarily because of poor demand for products.

"Demand for optics remains strong in datacenters, as well as access and metro networks," said Kozlov. "Weaker than expected sales of high data rate transceivers in the second half of 2011 are probably related to many new products developed by component vendors in 2011 and introduced in early 2012. Having too many options to choose from complicates purchasing decisions, but we expect that the market will return to double-digit growth in 2012."

During 2011, the Ethernet transceiver market held out as one of the largest segments of the optical component industry, but FTTx-related equipment gained significant traction. According to the study, the FTTx component sector experienced the fastest rate of expansion within the sector, achieving 23 percent growth.

FTTx represents the fiber to the home, business and general premises market, an area in which many telecommunications companies are making investments. Delivering fiber-optic network connectivity to consumers and corporations is becoming increasingly important as emerging technologies raise global bandwidth requirements and a greater portion of the world's population is demanding high-performance connectivity options to support their day-to-day activities. To a great extent, existing copper infrastructure cannot keep pace with this need, making broader implementation of optical equipment essential to sustaining the internet's growth.

Perle has an extensive range of Managed and Unmanaged Fiber Media Converters to extended copper-based Ethernet equipment over a fiber optic link, multimode to multimode and multimode to single mode fiber up to 160km.


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