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LightCounting: don't let China's optical communications market temporarily weak to influence

Date: 2017-06-30

2017/6/19, the latest quarterly market report for optical communications market research firm LightCounting, noted that the demand for 100GbE optical connections continues to outstrip the supply of large data center operators worldwide. Sales of QSFP28, SR4, PSM4, CWDM4 and LR4 modules grew by 40% in the first quarter of 2017, more than $250 million.

LightCounting data show that in the 1 quarter of 2017, total SONET/SDH, CWDM/DWDM, Ethernet, fibre channel, FTTx, wireless module and AOC light prequel, embedded optical module sales fell 5%, but an increase of 15% a year ago. It is expected that the impact of the slowdown in the Chinese market will bring an additional 3-5% decline in the 2 quarter, and the market for tunable lasers, modulators and coherent receivers may fall further by more than 20%.


The slowdown in the Chinese market is mainly reflected in the sharp decline in orders for HUAWEI and ZTE in March. The reason behind this was that, in early 2016, the United States sued ZTE for violating the Iran export embargo policy, and ZTE and HUAWEI's stockpiling of us made optical devices quickly released after the settlement of the United States and zte. However, this analysis did not receive any direct certification.
LightCounting says it has seen some signs of market recovery in June, and there are likely to be more in July and August. If the impact of inventory, rarely possible more than 6 months. ZTE and HUAWEI's light equipment sales have improved in the 1 quarter and are expected to be strong in the future. Lightcounting's visit to Chinese operators shows that investment in optical networks is still growing, even as operators' overall Capex spending falls. The second half is expected to arrange a lot of project construction and bidding.
Globally, the deployment of optical networks remains strong. After years of stagnation, India's network construction has begun. Sales of 200G DWDM ports hit a new record in the 1 quarter of 2017. And there's a lot of work on 400G single wave transmission. Deployment of the 200G/400G optical module has already begun. Many start-ups want to challenge existing suppliers in this market.
LightCounting pointed out that this year's optical communications market will have many exciting news, we will see more in 2018. Do not let the Chinese market temporarily weak, affecting the long-term view of the optical communications market.



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