New analyst data confirms 100G’s exploding growth

For the last six months I’ve been highlighting the fact that 100G has made the move to the mainstream with customer deployments.  Now some new insight from two very respected industry analyst firms sheds more light on this shift with some specific data.

In its just-released Optical Transport forecast, Dell’Oro Group pins the 100 Gbps market as the key to growth in the broader WDM market.  “We are finding that the demand for 100 Gbps wavelengths is especially strong as service providers continue to expand their network capacity. 

"We currently predict 100 Gbps wavelength shipments to grow at a 75 percent CAGR over the next five years, and that by 2017 approximately 60 percent of the WDM capacity shipments will be with 100 Gbps wavelengths,” said Jimmy Yu, Vice President of Optical Transport Market Research at Dell’Oro Group in this press release highlighting the new report. 

Likewise, in a recent survey of global network operators about their plans for 40G/100G deployments, Infonetics principal analyst for optical, Andrew Schmitt, found that “operators participating in our study expect coherent 100G to take over most core networks by 2015 and even make some minor inroads into the metro.”

Among the Infonetics survey respondents, by 2015 coherent wavelengths will account for 68% of deployments in the core and 29% in the metro (see chart to the right), with 100G rising to 37% of deployed wavelengths versus just 5% today. 

In a separate report on the optical transceiver market, Schmitt highlighted that "growth of 100G is exceeding our most optimistic predictions,” and that “there’s been a flurry of prototyping, sampling and trial activity all around the world, including China, where plans for 100G have been bumped up by 12 months since we spoke to operators there last spring. In line with our aggressive forecasts, worldwide shipments of 100G coherent transceivers more than tripled in 2012, and will at least double in 2013.”

Interestingly, these optimistic forecasts for the 100G and WDM markets come at a time when data shows that spending in the overall optical transport market is flat or down.  In its most recent update, Infonetics saw worldwide WDM optical revenue grow 6.9% while overall optical hardware spending fell 2%, spurred by the fact that SONET/SDH spending hit an all-time low. 

“On a brighter note, there’s an investment cycle set to begin next year in the core network that’s based on 100G coherent and supported by the massive ramp in 100G prototyping and trialing activities that are already underway worldwide," said Schmitt in the report analysis.

Similarly, Dell’Oro’s latest numbers had the total WDM market growing 14% year-over-year, even in an overall optical market that shrank, and highlighted that WDM spending would soon surpass the pre-bubble days of 2000.

One area for possible debate between the two projections is the role that 40G will play in future service provider deployments.  While Dell’Oro seems to feel there is still a role left for 40G, Infonetics analyst Andrew Schmitt boldly states that “the debate between 40G and 100G in WDM networks is over.”

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