Ethernet Services Revenue Still Growing Strong

Optimum Lightpath : Carrier Ethernet innovation leader Optimum Lightpath reported that corporate revenues grew 20 percent year-over-year to $61 million in the second quarter of 2008. Lightpath said that rapidly growing Ethernet services more than made up for a decline in legacy data sales, so we are talking about an Ethernet growth rate above 20 percent. Lightpath also reported that more efficient, higher-margin Ethernet services were principally responsible for driving operating income improvement.

tw telecom inc. (Nasdaq: TWTC) (formerly Time Warner Telecom): At the forefront of the North American Ethernet services market for several years, tw telecom reported that its data and Internet services revenues grew 24 percent year-over-year to $97 million, due primarily to strong demand for Ethernet and IP-based solutions. tw telecom reported that about two thirds of its enterprise revenue was derived from customers that need connectivity in multiple locations.

KDDI Corp. : Japan-based KDDI reported that its wide-area Ethernet services revenue grew 16 percent year-over-year to $165 million (¥17,484 million) in the first quarter of its fiscal 2009, ending in June 2008. Ethernet progress outpaced the 10 percent growth of IP VPN services and contrasted sharply with a 10 percent decline for traditional leased data circuits. KDDI's Ethernet services revenue in the June 2008 quarter was nearly twice as much as its IP VPN revenue and 50 percent greater than its leased circuit revenue.

NTT Communications Corp. (NYSE: NTT): NTT's growth story for Ethernet, IP VPN, and legacy data services revenues tracked directionally with KDDI's in the June 2008 quarter. NTT reported that wide-area Ethernet services revenue grew 9.5 percent year-over-year to $129 million (¥13,682 million), IP VPN services revenues grew 4 percent, and leased data circuit services revenues declined 7.5 percent. But IP VPN and leased circuit services each still generate more revenue than Ethernet for the operator.

Colt Technology Services Group Ltd : Pan-European operator COLT – which recently launched phase 1 of its carrier Ethernet-centric next-generation network deployment – reported that Ethernet demand helped fuel 13 percent year-over-year growth in corporate data services revenue (measured in constant currency).