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Tuesday, May 17, 2011

Cisco Captures #1 Spot in Packet Optical Transport Segment for Q1/11: ACG Research Optical Networking Market Share Report

The Worldwide Packet Optical Transport Market has seen typical 1Q seasonality, declining 16.1% sequentially but growing 21.0% year over year, according to ACG Research. The total Worldwide Optical Networking market declined 18.1% sequentially but grew 3.7% year over year in Q1 2011.

Cisco has regained the number one position with 19.9% of total market share in Packet Optical Transport, bumping Alcatel-Lucent down to the #2 spot. In an interesting market shift, Fujitsu has jumped to the third spot, because of strong North American shipments. The optical market continues to recover from the recession; however we expect delays in 100G deployments as vendors struggle to bring product to market. This bodes well for Ciena, which already has 100G product shipping, and Cisco as most operators are looking for a second source, and the options for those positions are still wide open.

ACG is optimistic about the future outlook of the Packet Transport market. We see service providers and content providers spending on their backbone networks as well as making significant architectural plans to change their metropolitan networks. Vendors that execute on their packet transport strategy stand to gain significant market share in this segment.

Top Vendors- Worldwide Packet Optical Transport Systems (POTS) Market

Vendor

1Q11

Rank

Q-Q Revenue Growth

Y-Y Revenue Growth

Cisco

1

-8.8%

21.6%

Alcatel-Lucent

2

-47.3%

92.5%

Fujitsu

3

48.9%

65.0%

Tellabs

4

-15.5%

-15.3%

Ciena

5

1.6%

314.5%

Total


-16.7%

21.0%


QUARTERLY TREND and DRIVER HIGHLIGHTS
  • The packet transport market is wide open to router vendors with optical platforms if they can deliver on 100G and ROADM technologies.
  • OTN architecture is clearly resonating with operators, but adoption of OTN standalone platforms within major carriers involves a long selling and new certification cycle.
  • MPLS-TP, a source of contention in the standards bodies, is seeing slow adoption outside of specific networks in China and Europe. The rapid deployment of Ethernet technologies may, in fact, eclipse or delay MPLS-TP solutions.
For more information contact Karen Grenier, kgrenier@acgresearch.net.

Juniper Recovers #2 Spot from Alcatel-Lucent in Q1/11 Service Provider Routing & Switching Market Share Report: ACG Research


The Worldwide Carrier Routing & Switching markets have seen typical 1Q seasonality, declining 14.2% sequentially but growing 9.0% year over year, according to ACG Research. The Total Worldwide Carrier Routing & Switching market grew revenue $2.7B in Q1/11. Core Routing revenues were down 11.2% q/q and up 9.5% y/y. Edge Routing & Switching revenues down 15.1% q/q and up 8.9% y/y.

Cisco continues to hold the number one position with 50.3% of total market share. In a dramatic market shift, Juniper reclaimed its number two spot, bumping Alcatel-Lucent to number three. According to Ray Mota, managing partner, “this seasonal decline was expected, especially after the strong growth posted in Q4.” ACG is cautiously optimistic about the future outlook of the market. “We see service providers spending on cloud computing and video services and managed services will help drive growth in the remainder of 2011. Vendors that execute on their strategy stand to gain good market share of CapEx spend associated with those services.”

Top Vendors: Worldwide Carrier Routing & Switching
Vendor
1Q11
Rank
Q-Q MS Point +/-
Cisco
1
1.9
Juniper
2
(2.3)
Alcatel-Lucent
3
(4.0)
Tellabs
4
0.3
Ericsson
5
(0.1)

QUARTERLY TREND and DRIVER HIGHLIGHTS
  • Carriers are reducing their CapEx this quarter but still spending in mobility and new services creation opportunities.
  • Many providers have exhausted or will soon exhaust their IP addresses. Service providers have to decide about IPV6 now and gradually increase their costs or continue to employ band aid solutions to NAP and risk their business continuity.
  • Security is the number one concern of enterprises as they continue to move toward virtualization and cloud offerings.
  • Carriers are looking to Carrier Ethernet, QoS, CDN, IPV6, and end-to-end technologies to address their pain points associated with the increasing amount of video traffic.

ACG focuses on providing market analysis and consulting to help service providers and vendors monetize their existing infrastructures and increase operational efficiency and profitability. ACG is uniquely qualified to develop the TCO analysis and white paper. ACG applies multi-disciplinary expertise and multidimensional solutions to complex business and technology issues, delivering greater strategic value than a one-dimensional firm. Each consulting engagement is uniquely structured — no forced methodologies or canned reports are employed. Our consultants’ collective experience is derived from leading firms across a broad spectrum of professional disciplines including management consulting, engineering, marketing, financial analysis, and IT management and operations. We combine advanced academic degrees with practical business experience.

ACG has extensive experience assisting vendors and service providers define and execute their marketing programs from determining their value proposition, positioning and messaging; to prioritizing marketing programs; to supporting execution by designing seminar series and developing and delivering compelling content such as keynote presentations, sales and analyst presentations, white papers, videos and articles.

Our strong relationships with vendor market leaders and innovative start-ups, enables ACG to offer extensive knowledge of product portfolios and strategies as well as emerging architectural shifts. We have a strong track record of predicting market trends and separating hype from practical reality.

Karen Grenier, Marketing and Communications
kgrenier@acgresearch.net
Desk: +1 408-200-0967


Tuesday, May 3, 2011

Huawei Conference 2011: An ACG Report

Eve Griliches and approximately 200 financial analysts, industry analysts and media attended the 2011 Huawei Analyst conference in Shanghai and Beijing last week.

In 2010 Huawei forecasted 20% growth for 2011. Actual growth was 24.2%, $28 billion, and the company’s operating profit increased 15.8% to $4.4 billion. Cash flow was $4.3 billion with a CAGR of 49% over 5 years. Huawei estimates that the company will end 2011 at $31 billion for the year. Huawei attributed the increased revenues to its 1) consolidation of leadership teams, which increased efficiencies and focus, and 2) expansion into and penetration of the enterprise and device businesses. Highlights for 2010: enterprise segment came in at $2 billion, and Huawei initiated 47 major managed services contracts and created a cyber security center in the UK.

This report covers some general highlights, which are in the annual report, some key trends, internal challenges as well as Huawei’s overall strategy for several product lines. It also discusses some product line issues. To read more, go to ACG Research's our store or contact sales@acgresearch.net.






Monday, May 2, 2011

ACG Research Cites Top 7 Cloud Providers

Cloud computing is hot, and the race is on for cloud providers to position themselves in the market. All of this growth is positive. However, although there are many companies offering cloud computing services, only a few have the levels of cloud architecture, technology and services that efficiently and cost effectively help enterprises of all sizes move into the cloud. To help sort it out, ACG Research's cloud analyst Jerome Oriel has identified the top seven cloud service providers (not in order of preference) that have the right combination of cloud computing services elements and cites strengths and weaknesses depending on their cloud strategy. Click here to read Jerome's SearchTelecom.com article on the top seven.


Jerome Oriel

joriel@acgresearch.net
www.acgresearch.net