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Global carrier Ethernet equipment market to generate $186bn over next five years

Ethernet is gradually replacing legacy SONET/SDH equipment

The global carrier Ethernet equipment market grew 13.4 per cent to reach $31.7bn in 2011, and will go on to hit $42.4bn in 2016, according to US market research firm Infonetics Research.

“Over the five years from 2012 to 2016, operators will spend a cumulative $186bn worldwide on carrier Ethernet equipment, outpacing overall telecom capex,” said Michael Howard, principal analyst for carrier networks and co-founder of Infonetics Research.

“Every major operator in the world, including BT, Belgacom, Swisscom, Telstra, FT-Orange, Verizon, AT&T, NTT, KDDI, China Mobile, and many others have explicit IP NGN transformation projects going, for which they will use plenty of Ethernet as they gradually replace their legacySONET/SDH equipment.”

Mobile backhaul continues to be a particular Carrier Ethernet growth area, according to the report, with IP/Ethernet equipment making up 93 per cent of all mobile backhaul equipment spending in 2011.

The chief market drivers for carrier Ethernet equipment sales remain service providers moving to IP packet-based next-generation networks, which depend heavily on IP, MPLS, and Ethernet technologies, as well as growing traffic (particularly video traffic) from consumer, business, and mobile backhaul networks.

Ethernet is described as being a less expensive way to interconnect telecom equipment, whether routers to routers, DSLAMs to routers, or routers to optical gear. The largest carrier Ethernet equipment segments by carrier spending are IP routers, carrier Ethernet switches (CES), and optical gear, according to Infonetics Research.


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