Optical transport equipment market dips 13% in Q1 – Dell'Oro reports

Optical transport equipment market drops 13% in Q1

The optical transport equipment market has experienced a 13% year-over-year decline for Q1 2024, according to analysts with Dell'Oro Group. They forecast a 2% decline for the full 2024 year as well.

The Q1 decline is a result of excess DWDM system inventory and cautious spending by service providers during an uncertain macroeconomic climate, explained Jimmy Yu, VP for Dell'Oro.

"We think the steeper-than-expected drop in optical transport revenue in 1Q 2024 may have been driven by communication service providers becoming increasingly cautious about the macroeconomic conditions, causing them to delay projects into future quarters," said Yu in a statement.

In Q1, North America and parts of Asia-Pacific experienced the steepest declines in the optical transport market, but China and the Middle East and Africa (MEA) region experienced growth of 8% and 16%, respectively. On the vendor side, Cisco, Huawei and ZTE gained market share of 1% YoY.

Arelion adds new routes to Gulf Coast network

Arelion expanded its Gulf Coast network this month with the launch of two multi-terabit capacity routes from Jacksonville, Florida, to Atlanta and extending in Florida from Jacksonville to Tallahassee, which is also a new market for Arelion. The expansion includes an overbuild from Miami along Florida's west coast up to Atlanta.

The service provider said the new routes will support both local and subsea traffic flowing into Atlanta from the Caribbean, Central America and South America through subsea cables landing in Jacksonville.

"By providing additional meshing and diversity into Atlanta, we can serve the connectivity requirements of local enterprises while supporting subsea traffic from Jacksonville and other Florida edge markets and sea cable landings, enabling low-latency cloud, content and AI/ML delivery across diverse industries," said Art Kazmierczak, director of Strategic Sales and Network Development at Arelion, in a statement.

The new routes utilize open optical line systems supporting C+L Band, sixth-generation coherent optics and include multivendor 400G wave capabilities to support the company's wholesale and enterprise customers.

Arelion now has a total of four route options into Jacksonville and six route options into Atlanta. The two new routes will be live in Q3 of this year.