Huawei Swipes Optical Market Share

Analysts seem to agree: Huawei Technologies Co. Ltd. is the new top dog in optical networking.

This week, two different research houses released market-share data, and both concluded that Huawei was the No. 1 seed in the worldwide optical equipment market.

"If you go back to the beginning of 2007, Huawei has been growing at a 10 percent compounded annual growth rate (CAGR)," says Andrew Schmitt, directing optical analyst at Infonetics Research Inc. "The overall market has been flat for that period, which suggests that Huawei has been taking market share from everyone else."

"Also, the Asia Pacific region has been very strong in the last couple of years, and Huawei is the dominate vendor in that region," Schmitt says.

Table 1: Huawei's Total Revenues (USD $B)

Also this week, Ovum Ltd. noted that the global optical networking market was down 8 percent to $3.6 billion worldwide in the first quarter of 2009, compared to the year-ago quarter. But Ovum's figures did say that Huawei stood out by booking around $790 million in optical-related revenue during the quarter, with growth in Asia and hardly any exposure to North America. Alcatel-Lucent, Ovum noted, "suffered from much of the opposite."

"Huawei is on a different growth path from the competition -- and it has been for some time," explains Heavy Reading analyst Sterling Perrin. "Owning the Chinese market in optical is one advantage, but it’s not the only one... In the first quarter of 2009, 40 percent of Huawei's optical revenue came from outside of Asia, with 32 percent of its total revenue coming from EMEA [Europe, Middle East, Africa].

"Clearly, in EMEA, Huawei is eating into Alcatel-Lucent and other European vendors that always counted the region as their stronghold," Perrin says.

— Phil Harvey, Editor-in-Chief, Light Reading

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