& cplSiteName &

Infonetics Bullish on Ethernet Prospects

Light Reading
News Analysis
Light Reading
1/28/2004

Big increases in carrier spending on Ethernet equipment are being forecast by Infonetics Research Inc., following surveys of service providers and vendors.

Infonetics conducted formal interviews with 27 infrastructure-owning carriers for its latest report, entitled “Service Provider Plans for Metro Optical and Ethernet,” released yesterday (see Infonetics Surveys Ethernet Capex Plans).

The results indicate that nearly two thirds of carriers plan to roll out QOS-based services over Ethernet by next January. These services include packetized voice, bandwidth on demand, and private lines.

The survey also points to two significant swings in the market. First, retail has now overtaken wholesale as the main source of revenue for Ethernet services. Second, 63 percent of respondents now say they will use Resilient Packet Ring Technology technology in their networks after January 2005, twice as many as in 2003.

This is reflected in RPR equipment revenue forecasts. Infonetics says RPR revenues hit $323 million in 2003 and will triple to $967 million in 2007, a compound annual growth rate (CAGR) of 32 percent.

These figures were incorporated into forecasts for metro Ethernet equipment revenues released by Infonetics last week. It says vendor revenues totaled $2.9 billion in 2003, and this will rise to $7.5 billion in 2007, a CAGR of 27 percent. In terms of ports, it will rise from 1.1 million in 2003 to 5.8 million in 2007, a CAGR of 52 percent (see Metro Ethernet Equipment Tops $2.9B).



Table 1: CY2003 Worldwide Total Metro Ethernet Equipment Technology Share

Technologies Market Share
Ethernet over fiber 66.7%
Ethernet over Sonet/SDH 20.9%
Ethernet over copper and cable 5.5%
RPR over fiber 3.5%
Ethernet over WDM 2.9%
Ethernet PON 0.4%
Total Revenue 100.0%
Source: Infonetics Research




Port shipments in 2003 were almost equally divided between provider equipment (PE), which accounted for 51 percent of sales, and customer located equipment (CLE), which made up the remaining 49 percent; but Infonetics expects a 20 percent shift towards CLE ports, with PE at 31 percent, by 2007.

"The shift is because Asia is quickly rolling out lots of VDSL, which gives 30 to 100 Mbit/s to customers over copper," says Michael Howard, founder and principal analyst of Infonetics. China, for example, has a goal of 75 million broadband users by the 2008 Olympics. As a result, service providers in the Asia/Pacific region continued to drive the global market last year, accounting for 41 percent of revenue.



— Nicole Willing, Reporter, Light Reading

(5)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
technonerd
technonerd
12/5/2012 | 2:34:02 AM
re: Infonetics Bullish on Ethernet Prospects
Would someone want to tell us the difference between "Ethernet over Fiber" and "Ethernet over SONET/SDH?" This should be really good, because the fact is that "gigabit ethernet" is actually Ethernet over SONET. I've had some hilarious conversations at trade shows about this. Once you find someone in the booth who actually knows what the hell his company actually makes, he'll eventually whisper something to the effect that yes, it's relly Ethernet over SONET but everyone prefers to call it Next-Gen Ethernet because it sounds better that way.
technonerd
technonerd
12/5/2012 | 2:34:01 AM
re: Infonetics Bullish on Ethernet Prospects
... it wouldn't surprise me if the carriers began emphasizing Ethernet now that the "Ethernet in the First Mile" (gotta love that one) people have ratified QAM and QAM derivatives that were available but not used during the bubble. The whole ATM access thing was always a joke; the real crime is that the "new carrier" VCs bought into it along with the wrong copper line codes.

Oddly enough, though, all of this may well come too late for the mass-market side of things if voice migrates to cellular like I think it will. Even with linecodes that work for data, you still need customers writing big fat voice checks every month.
pritamganguly
pritamganguly
12/5/2012 | 2:33:51 AM
re: Infonetics Bullish on Ethernet Prospects
Ethernet ( gigabit ethernet and 10G ethernet ) can be transported over SONET/SDH via WIS ( WAN Interface Sublayer)or directly over fiber through 1000BASE-X series physical layer. For more detailed information you can look into the IEEE drafts for gigabit ethernet ( 802.3z ) and 10G ethernet (802.3ae)
technonerd
technonerd
12/5/2012 | 2:33:48 AM
re: Infonetics Bullish on Ethernet Prospects
Got a link? Also, which suppliers sell fiber Ethernet PHY equipment, and which major carriers actually use it? The people I trust tell me that the stuff being installed is actually Ethernet-over-SONET/SDH. But who knows, maybe I'm wrong. It all reminds me of the hype about DWDM "replacing" SONET when in fact the carriers are simply running SONET on each color.
fiberlackey
fiberlackey
12/5/2012 | 2:33:35 AM
re: Infonetics Bullish on Ethernet Prospects
We offer both Ethernet and SONET phys for our metro product. Carriers won't use Ethernet phys because of their existing investment in SONET (more in opex costs for OSS changes, etc.)

Greenfields go with Ethernet phys (MSOs, regional ilecs, universities, China, etc) do to lower equipment cost.
Featured Video
Upcoming Live Events
October 22, 2019, Los Angeles, CA
November 5, 2019, London, England
November 7, 2019, London, UK
November 14, 2019, Maritim Hotel, Berlin
December 3-5, 2019, Vienna, Austria
December 3, 2019, New York, New York
March 16-18, 2020, Embassy Suites, Denver, Colorado
May 18-20, 2020, Irving Convention Center, Dallas, TX
All Upcoming Live Events