Optical/IP Networks

Agilent Hits the Field

Agilent Technologies Inc. (NYSE: A) just celebrated the 18-month anniversary of its Optical Network Test (ONT) business unit. And the company's boasts about its progress put the market sector it's trumpeting squarely in the spotlight.

That sector is fiber optic field test equipment, the instruments used by technicians to install and maintain single- and multi-mode fiber in carrier networks. This market is said to be growing respectably, even in the downturn, thanks to the many new fiber links required by carrier customers -- as well as the seemingly endless array of Sonet upgrades and readjustments they demand.

Key devices in the sector include portable or "mini" optical time domain reflectometers (OTDRs), which give installers a way to test the ability of a link to handle data traffic by sending a light pulse down the fiber and measuring the strength of the signal. Also in this market are handheld power meters, fault finders, light sources, and optical spectrum analyzers for checking the strength of DWDM channels.

According to market research firm Frost & Sullivan, fiber optic field test gear comprises roughly 30 to 50 percent of a market for physical-layer fiber test instruments that's estimated to be worth $1.5 billion in 2001. The market is expected to continue to grow at well over 20 percent annually for the foreseeable future.

"We're serious about dominating this market," says Peter Schweiger, ONT's channel manager. "In five years' time, we want customers to use our brand name as commonly as they ask for a Kleenex. We want them to say, 'Do you have an Agilent to test that?' 'Did you put the Agilent on that?' "

Since April, Agilent has offered a mini-OTDR and accompanying software toolkit; a power meter, light source, and optical attenuator; and a fiber break locator.

Analysts say Agilent's likely to do well in the sector, because it's already involved in high-end fiber optic test gear for use in labs and in manufacturing environments. Indeed, some observers see ONT as an effort by Agilent to call attention to the rest of its test suite.

"This enables Agilent to remind customers of its higher-end instruments," says Frost & Sullivan senior industry analyst Bal Ganjoo. "I have no doubt they'll do well. Historically, their R&D equipment has been excellent."

Still, competition is tight. Just three companies hold over 50 percent of the market for portable or mini OTDRs, for instance -- and Agilent isn't one of them. Instead, GN Nettest is top dog, with roughly 19.5 percent of about $250 million in mini-OTDR revenues worldwide for 2001, according to Frost & Sullivan. The other two key vendors are EXFO Electro-Optical Engineering Inc. (Nasdaq: EXFO; Toronto: EXF) and Anritsu Corp., in that order.

All three seem oblivious to Agilent's "onslaught." GN Nettest, for instance, says the key differentiator for its mini-OTDR is an optional optical spectrum analyzer module that fits right into the gadget's mainframe, or chassis, giving technicians two instruments in one. Exfo and Anritsu also claim this feature. Exfo says it adds the ability to run multiple tests from one touchscreen, as well as a highly "ruggedized" unit capable of being deployed in a range of outdoor environments without being damaged.

For its part, Agilent doesn't offer a spectrum analyzer for use with its mini-OTDR, saying it's opted to eschew the extra weight and cost such an analyzer would add. Agilent also claims its product will run up to eight times faster than Nettest's or Exfo's. And, according to Agilent, the importance of delivering faster results in the field is second only to that of the increased automation that helps eliminate "truck rolls" for carrier customers.

Both GN Nettest and Exfo, which reign in the field test sector, are aiming to launch high-end R&D to compete with Agilent, which leads in the lab. According to Ganjoo, they're aiming, like Agilent, to round out their product lines in order to tackle related opportunities.

"A lot of these devices, such as mini-OTDRs, are starting to be used in the lab as well as the field," Ganjoo says. This makes it tough to set an exact figure on the percentage of all physical-layer test gear that's sold for field use. Apparently, Agilent and other competitors in this market are intent on making the most of the blurred distinctions.

— Mary Jander, Senior Editor, Light Reading
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