Alcatel, Huawei, Nortel top 3Q06 networking market

Jan. 1, 2007

Ovum-RHK recently announced its preliminary analysis of 3Q06 results for optical networking equipment vendors. Revenues were US$3.1 billion, up 13% versus 3Q05 and up 5% versus 2Q06, say analysts.

The report provides highlights of the top 10 vendors:

Alcatel’s revenues were up 27% sequentially and up 21% versus 3Q05 to lead the market both in 3Q06 and in annualised share. The vendor captured a 16.8% market share with its US$516 million in sales.

Lucent’s sales grew 11% in the quarter but declined 7% versus 3Q05, dropping from fourth to fifth place (rolling 4Q share).

Nortel’s revenues increased 5% sequentially and 8% versus 3Q05 to remain in third place with a 10.1% market share (4Q rolling share).

Huawei’s revenues dropped 27% sequentially off a huge 2Q06 but were up 24% versus 3Q05 to remain number two, with a 9.5% annualised share.

“Global spending continues to grow as bandwidth required for broadband wireline and mobile applications puts pressure on operators to both expand existing networks and build new ones,” explains Dana Cooperson, vice president of optical networking and practice leader, network infrastructure at Ovum-RHK.Moreover, says Cooperson, the softness that Ovum-RHK reported in 2Q06 spending for multiservice SONET/SDH devices has widened to include all three major regions, with “mounting evidence that the shift in spending away from SONET/SDH devices to metro WDM in the metro core has begun.” Only the CALA region bucked the trend this quarter. That said, the multiservice SONET/SDH market remains about three times the size of the metro WDM market, says Cooperson, and there is little evidence that Layer 2 switches are cutting into SONET/SDH sales.For more information, visit www.ovum.com.