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Cignal AI’s 3Q20 Transport Applications Report has been issued. It includes:

  • 3Q20 market share results for Compact Modular and Advanced Packet-OTN switching equipment hardware
  • 3Q20 coherent port shipment market share, including fixed modules (100Gbps, 200Gbps, 400Gbps+), pluggables (100ZR, 400ZR, 400ZR+), and 100Gbps direct detect optics
  • Hardware and coherent port forecasts for 2020-2024

On January 5th, 2021 at 11 AM EST there will be a live presentation of the 3Q20 Transport Applications report results. Clients can register to attend the presentation by following the link below. A replay and downloadable presentation file will be available after the event.

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Release Notes:

Cignal AI introduced initial 100ZR and 400ZR+ forecasts last quarter, and we have not made material changes this quarter. Here is the methodology:

  • The coherent port forecast always included growth post-2022 for 100Gbps shipments. This projection assumed a low-cost coherent 100Gbps solution would reach the market in 2021. The 100Gbps port forecast is now divided into fixed 100Gbps coherent hardware and pluggable 100ZR modules to present this distinction better.
  • Readers should assume that 400ZR+ does not create a new market; instead, it cannibalizes a portion of the fixed 100/200/400Gbps+ coherent market. Our forecast for 400ZR+ assumes the availability of both CFP2 and QSFP-DD formats, and 10% penetration of pluggable technology in metro/long-haul networks in 2024.
  • The performance, price, and availability of 100ZR and 400ZR+ modules remain very fluid. You may expect this forecast to be adjusted as capabilities become more clear.

Highlights of Cignal AI’s 3Q20 Transport Applications Report include:

Compact Modular and Packet-OTN Hardware

  • Compact Modular is rapidly gaining popularity with a wider set of network applications and operators, as evidenced by this quarter’s Compact Modular sales again growing faster than the overall optical market. Compact Modular sales also grew significantly in North America while total optical sales declined in the region this quarter.
  • APAC Compact Modular sales grew by more than 75% this quarter, as sales in that region approach the level of sales in EMEA. Huawei (mostly in China), Fujitsu (in Japan), and Nokia all more than doubled their compact modular sales into APAC. Ciena, ADVA, and Cisco also had strong YoY sales growth in the region.
  • Although Ciena reported a flat quarter overall for optical sales, its Compact Modular sales were up +18% YoY. The company maintained its market leadership in the segment with over 40% market share worldwide, while Infinera, Cisco, and ADVA each claimed at least 10% share.
  • Packet-OTN sales continue to be focused in APAC, which has the largest sales volume and the highest growth rates in the market. YoY sales of Packet-OTN equipment only grew in APAC this quarter, and sales in NA declined by more than -25%.
  • Packet-OTN market leaders Huawei and ZTE grew sales due to their strength in China while all other vendors’ sales declined YoY.
  • Overall Compact Modular growth is forecast to decelerate to low single digits, and Packet-OTN growth is forecast to be flat in the 4th quarter as CapEx budgets have been exhausted, especially in NA. A worldwide decline in optical sales in the 4th quarter (see the Cignal AI Transport Hardware Report for details) will depress compact modular and Packet-OTN sales in all regions except APAC.

Coherent Ports

  • Sampling of OIF-compliant 400ZR as well as extended ZR+ pluggable coherent modules is well underway, with several hundred modules shipped for testing and evaluation. The demand pipeline remains strong and will be supply constrained in 1H21. We have made no changes to our forecasts.
  • Acacia shipped approximately 5,000 400Gbps+ ports and nearly set a record for single customer revenue in a single quarter. We believe these devices are part of a large whitebox build at Amazon AWS and functioning as a third source to compete against Ciena and Infinera.
  • Total shipments of fixed 400Gbps+ coherent ports jumped 65% QoQ to nearly 37,000 ports as shipments of 400Gbps and 800Gbps ports from several vendors increased sharply. In addition to Acacia/Amazon, Ciena contributed to this increase with rapid growth in 800Gbps Gen5 coherent shipments.

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