Global spending on DSL, PON, and fiber-to-the-home (FTTH) equipment declined 22% between the fourth quarter of 2011 and the first quarter of 2012, to $1.8 billion, reports market research firm Infonetics Research .
Despite a 40% sequential decline in broadband aggregation equipment revenue in 1Q12 from the previous quarter, Huawei (Shenzhen, P.R.C.) maintains its worldwide revenue lead (though with significantly less share), followed by ZTE (Shenzhen, P.R.C.) and Alcatel-Lucent (Paris), says Infonetics (Campbell, Calif., USA). Only a handful of broadband aggregation equipment vendors managed to increase their revenue in 1Q12, including many of the top players in Japan: Fujitsu, O.F. Networks, and NEC
"In addition to seeing a first-quarter lull as we often do in the worldwide broadband aggregation market, there was a big 43% drop in Ethernet PON spending in China that drove spending in Asia down a full third this quarter, despite healthy increases in Japan and the rest of Asia Pacific,” says Jeff Heynen, directing analyst for broadband access and video at Infonetics Research. “The drop in China is due mainly to a shift to FTTH this year and coming off the heels of a record previous quarter. Another more serious drag on the overall market was a third consecutive quarter of DSL revenue declines in EMEA, where access network upgrade projects have stalled because of the unstable economic environment."
EPON spending in Japan increased 11% in 1Q12 from 4Q11, as NTT and KDDI are in the midst of upgrading their FTTB+VDSL deployments to FTTH and are beginning to replace fully depreciated EPON gear from 2004 and 2005, says Infonetics.
With Verizon 's FiOS and AT&T's U-Verse rollouts slowing, combined with seasonal softness, the North American combined PON, DSL, and FTTH equipment markets saw 21% declines in 1Q12. The Latin American market remains fiercely competitive, it is clear that operators spent 1Q12 absorbing the new capacity they purchased in 4Q11, when record spending was recorded in the region, says the research firm.