Dramatic growth in the optical components market in 2010

In a new report**, the independent telecoms analyst states that the OC market led the telecom market recovery from the global recession of 2009 with its dramatic gain in 2010. However, Ovum believes the market will experience slower growth this year.

Daryl Inniss, Ovum analyst and author of the report**, commented: "The 35% year-on-year growth experienced by the OC market in 2010 was the highest since the telecom bubble years, when the market more than doubled in one year. However, we do not believe the market is experiencing another bubble.

"We predict that growth in the OC market is the best indicator for the next wave of telecom infrastructure expansion, as the 2010 increase follows the industry-wide contraction of 2009. What we expect is that the OC market will continue to expand in 2011, but at a slower rate."

Future outlook is good

The OC market grew by 5% sequentially in the last quarter of 2010, for the seventh consecutive quarterly gain. By segment, this growth was led by ROADMs and filters, long-distance transmission devices, and transmission discretes. ROADMs and filters was the fastest-growing OC segment: it grew 46% in 2010 compared to 2009 and posted annual revenues of US$0.9 billion, and its fourth quarter 2010 revenues of US$260 million represented a 10% sequential increase, way above the industry average of 5%. Ovum believes the future outlook for this segment is good, as ROADMs are at the heart of all transport networks.

Inniss added: "There were many strong vendor performances in the fourth quarter of 2010. JDSU led the pack in terms of growth and increased its revenues by over 75% compared to the previous year and 17% sequentially. The company also grew its market share by 0.6% on the previous quarter."

*Exchange rate at time of publishing: $1=R6.79

** Market Alert: 4Q10 and 2010 Global OC and Market Share: 4Q10 OC Global Spreadsheet

Source: © Ovum 2011