CIR Iffy on Transmission Gear

CIR preaches cautious optimism for transmission components makers: the market will grow to $3.3B in 2006, but competition will be fierce

November 13, 2002

1 Min Read

CHARLOTTESVILLE, Va. -- CIR, a leading industry analyst firm based here, offers some practical advice to manufacturers of transmission components in its latest report, Transmission Components in Optical Networks: 2002-2006. Because the market downturn has forced service providers to change their focus from rapid, wholesale expansion to step-wise increments, where marginal upgrades and new line cards for existing equipment will be the preferred purchases for some time to come.Hence, although the worldwide transmission-components market is expected to grow to over $3.3 billion in 2006, the winners in this arena will be those that concentrate on core competencies and not bleeding-edge technology. There is demand for integrated components, but their cost will have to drop sharply if they are to secure a significant market share.Having heard a little optimism from the systems makers, components vendors cannot wait to position their products to take advantage of the metro market, even if they don't fully understand its demands. Tellingly, some cannot say what it is that makes their component especially suited to the metro space. Worse, while there will be a healthy market for metro SONET/SDH transceivers, few suppliers have manufacturing methods or component designs that will allow their devices to compete on price in the SONET/SDH segment.Communications Industry Researchers Inc. (CIR)

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