2Q18 Optical Applications Report

Cignal AI’s 2Q18 Optical Hardware Applications Report has been issued.

The new report has significant updates and enhancements:

  • Implemented rolling 12-month average data, allowing clients to see better see long-term market share and trends absent of seasonality effects.
  • Added 2Q18 market share results for Compact Modular and Advanced Packet-OTN Switching equipment hardware as well as 2Q18 100G+ port shipments.
  • Adjusted 100G+ port forecasts for 2018.

Current Optical Applications Report subscribers can download updated Excel and PowerPoint files.

Report Details Excel PowerPoint

 

Further detail on the changes and updates to Cignal AI’s Optical Applications Report are below:

Requires Optical Hardware Applications subscription

1Q18 Optical Applications Report

Cignal AI’s 1Q18 Optical Hardware Applications Report has been issued. Its arrival marks the first quarterly release of this report, which will now be standard practice; previously the report was published every six months.

The new report has significant updates and enhancements:

  • Added 200G and 400G+ vendor market share, allowing clients to see total port shipments by vendor along with details by port speed.
  • Added 1Q18 market share results for Compact Modular and Advanced Packet-OTN Switching equipment hardware as well as 1Q18 100G+ port shipments.
  • Adjusted Compact Modular and Packet-OTN forecasts. There have been some shifts in how both of these markets will develop.

The 1Q18 Optical Applications Report examines the following:

  • Compact Modular hardware market share and forecasts
  • 100G, 200G, 400G coherent port shipments & vendor market share
  • 100G, 200G, and 400G+ coherent, 400G ZR and direct detect port forecasts
  • Advanced Packet-OTN Switching market share and forecasts

Current Optical Applications Report subscribers can download updated Excel and PowerPoint files.

Report Details Excel PowerPoint

 

Further detail on the changes and updates to Cignal AI’s Optical Applications Report are below:

Requires Optical Hardware Applications subscription

4Q17 Optical Applications Report

The 4Q17 edition of the Optical Hardware Applications report has been released. The report contains details on the following areas:

  • Compact Modular hardware market share and forecasts
  • 100G+ coherent port shipments & vendor market share
  • 100G, 200G, and 400G+ coherent, 400G ZR and direct detect port shipments and forecast
  • Advanced Packet-OTN Switching market share and forecasts

This release has significant updates and enhancements:

  • Updates to the 400G port shipment methodology, simplifying the categorization of ports. Physical port shipments are no longer defined by reach. All 100G, 200G, and 400G+ coherent port shipments are counted, as well as direct detect and 400G ZR for edge applications.
  • Added 3Q and 4Q17 market share results for Compact Modular and Advanced Packet-OTN Switching equipment hardware.
  • Updated coherent port shipment market share to include Inphi ColorZ historical numbers. Despite not being a coherent solution, it does displace the use of coherent 100G and its impact should be measured.
  • The Compact Modular hardware forecast was increased again. This market continues to grow at rates that outstrip the most optimistic projections.
  • Report updates are now quarterly.

Current subscribers can download Excel and PowerPoint files.

Report Details Excel PowerPoint

OFC 2018 – Coherent Technology

Trends in coherent technology generated enthusiasm among the participants at OFC 2018, and 400G ZR applications were of particular interest. Nokia and Infinera outlined next-generation coherent roadmaps, and Acacia and NTT Electronics showcased silicon fresh back from the fab. Many component companies announced smaller, lower cost devices to enable new WDM applications. In this report, Cignal AI examines OFC 2018’s coherent technology announcements and their implications.

 

Requires Optical Active Insight subscription

Nokia PSE-3 Coherent Chipset

On March 6, 2018, Nokia announced its fourth generation coherent optical technology, the PSE-3, which continues the company’s strategy of developing coherent DSP processors in-house. Nokia is betting that these chips will differentiate the performance, price, and availability of its optical hardware products.

This Cignal AI report explores what makes the new PSE-3s different from off-the-shelf solutions and examines the question of whether or not vertical integration still makes sense in this market.

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Requires Optical Active Insight subscription

Investor Call – Piper Jaffray Optical Event

Piper Jaffray logo

Andrew Schmitt was the featured speaker on an investor call hosted by Troy Jensen of Piper Jaffray on February 21st. Forty-four participants listened in and posed their questions as Andrew gave his perspective on the latest events in the optical component and equipment market.

Topics during the call included:

  • Anticipated impact of China’s MIIT plan on existing component suppliers
  • The divergence in Chinese equipment revenue and supply chain
  • The market outlook for ROADMs in 2018
  • The 400G+ Coherent DSP and component outlook
  • The evolution of the CFP2-ACO and DCO market
  • Analysis of equipment companies outsourcing DSPs
  • Update on Inphi’s ColorZ, modulator driver, and PAM-4 business
  • Infinera’s market opportunity with the CX2 and ICE4 based products
  • North American CapEx in 2018 and optical equipment forecast
  • Ciena’s 400G market monopoly in 2018

Active Insight clients can access a summary of the key takeaways, a written transcript, an audio replay, and participate in Q&A.

Requires Optical Active Insight subscription

China’s 5 Year Optical Component Plan

China’s Ministry of Industry and Information Technology (MIIT) released a five-year plan in December 2017 outlining a roadmap for commercial and technological progress in a broad set of optical technologies. The 63-page document is in Chinese. The following Cignal AI report is based on a professionally translated version of the document and summarizes the section of the plan about the Chinese optical component industry.

The goals and objectives outlined in the plan are exceptionally ambitious and should concern incumbent component vendors. This document outlines strategic rather than rational economic objectives to catalyze market progress in Chinese component companies. Our interpretation is that this will increase the number of non-rational economic actors participating in the component market.

If executed, this plan will greatly increase the level of competition in an already fractured industry.  It will also reduce or in some cases eliminate access for western component vendors to the largest market for optical communications components in the world – China.

Electronic copies of the source MIIT document as well as the translated version of the section on optical components are available to clients for download.

Chinese PDF English PDF

 

Requires Optical Active Insight subscription

ECOC2017 – Coherent 100G+

ECOC is one of the most significant conferences in optical networking worldwide. This year’s conference was held in Gothenburg, Sweden, and the event was well attended by the engineering community, as the conference trends heavy on technology and light on marketing. We at Cignal AI like ECOC because it gives us another opportunity to converse with the folks directly responsible for charting the technical roadmap of upcoming optical systems.

In this first of several ECOC briefs, we share some of our findings on the changing trends in coherent optics. Subsequent briefs will explore China and client optics.

  • CFP2-ACO Outlook – The ACO market is going away; what this means
  • Silicon Photonics – Searching for the killer app
  • Inphi ColorZ – Moving downmarket to grow volume
  • 400G ZR – Examining investment risk and rewards
  • Acacia CFP2-DCO – Market Feedback

Requires Optical Active Insight subscription

1H17 Optical Applications Report

Our 1H17 edition of the Optical Hardware Applications report has been released.

The report contains details on the following areas:

  • Compact Modular hardware market share and forecasts
  • 100G+ Coherent port shipments vendor market share
  • 100G, 200G, and 400G+ Coherent and Direct Detect port shipments and forecast
  • Advanced Packet-OTN Switching market share and forecasts

This report includes significant updates and enhancements:

  • Initiated a coherent 400G port shipment forecast, estimating demand for 400G wavelengths in CY17 and beyond, including the upcoming 400G ZR pluggable format. The forecast also quantifies the emergence of coherent 100G in volume at the edge of the optical network. A more detailed written analysis sharing the assumptions behind this forecast will be published in the coming weeks. In the meantime, we welcome feedback on the quantitative forecast.
  • Renamed DCI Hardware category to “Compact Modular”. DCI is an application, not a hardware category, and these compact, modular chassis are being used in several applications, including DCI. As Incumbent, Cable MSO, and Wholesale operators evaluate and deploy these systems it is important that this category name better reflect the defining characteristics of these systems. A listing of the specific systems in this category can be found here.
  • Added 1H17 market share results for Compact Modular and Advanced Packet-OTN Switching equipment hardware. Also updated coherent port shipment market share to include vendor results for 1H17.
  • Compact Modular hardware forecast increased in 2017 and 2018 as result of discussions with vendors. This is a bottoms-up change with the risk that multiple vendors are double-counting the same opportunities.
  • Historical 100G+ Port Shipments adjusted to align with actual customer shipment data.

Current subscribers can download Excel and PowerPoint files.

Report Details Excel PowerPoint

China ROADM Deployment Outlook

After much of the world already transitioned to all-optically switched ROADM networks, Chinese network operators are preparing to follow suit. Most networks outside of China used optical switching as early as a decade ago, yet China chose to deploy massive electrical OTN switches instead, powered by technology from Huawei and ZTE. But now the writing’s on the wall; electrical switching can no longer scale to the sizes needed by China Mobile and China Telecom, and these operators are now moving forward with ROADM optical switching.

This transition will unfold with a different timeline than Cignal AI initially anticipated and we have updated our position on China’s 2017 ROADM deployment. Instead of pursing rapid deployment, Chinese operators will take a more conservative stand by minimizing the deployment of conventional ROADM architectures during 2017 and 2018.

In this report, Cignal AI examines what technology China has deployed to date, outlines changes in ROADM architectures, and explores the ripple impact on the optical component and semiconductor supply chain.
Requires Optical Active Insight subscription

2H16 Optical Applications Report

Our 2H16 edition of the Optical Hardware Applications report has been released.

The report contains details on the following markets:

  • Datacenter Interconnect Hardware market share and forecasts
  • 100G+ Coherent port shipments and market share
  • 100G+ Metro and edge port shipments and forecast
  • 100G+ Port shipments and forecast by speed & technology
  • Advanced Switching Hardware market share and forecasts

Notable updates include:

  • Full year market share results for 2016 including all hardware categories as well as updated coherent port shipment data
  • DCI hardware forecast increased as a result of accelerating adoption outside of Cloud & Colo customers
  • Forecasts for 100G and 200G+ metro and edge coherent ports adjusted
  • All forecasts extended through 2021

Subscribers can download Excel and PowerPoint files, and registered users can view updated report information.

Report Details Excel PowerPoint

OFC 2017 – Coherent Technology

400G Coherent and Beyond
Ciena had a blockbuster announcement at OFC 2017, but there was plenty of other interesting news to feast on. Cignal AI’s key takeaways concerning coherent WDM include:

  • The outlook for 200G and CFP2-ACO volumes in 2017
  • Opinions on Ciena WaveLogic Ai Licensing
  • The roadmap review for 400G/600G & Acacia Pico
  • Sizing the risk and reward for the 400G ZR market

Requires Optical Active Insight subscription

Investor Call – OFC 2017 Takeaways

Piper Jaffray logo

Andrew Schmitt provided key OFC 2017 takeaways during an investor call hosted by Troy Jensen of Piper Jaffray. Sixty-seven investors participated. Topics of interest included:

  • Impact of Ciena’s Wavelogic AI DSP Licensing
  • Outlook for Coherent Port Shipments in China During 2017
  • Market Outlook for CFP2-ACO/DCO and QSFP28 Markets
  • Potential Vertical Integration by Intel or InPhi
  • Timing of Metro Coherent and ROADM deployment in China
  • Chinese SARFT Capex Guidance
  • Roadmap for 400G and 600G Coherent
  • Observations on Infinera, Ciena, Acacia, Oclaro, and Neophotonics

Following is a summary of the key takeaways, as well as a full transcript of the discussion. Cignal AI clients can also listen to an audio replay.

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Ciena Wavelogic Ai and 400G Roadmap

Wavelogic AI

This past October, Ciena announced its new coherent DSP, dubbed Wavelogic Ai. Ciena used the announcement to convey its coherent 100G+ roadmap and support for 400G. Ciena also hinted at important changes to its 100G+ business model as Wavelogic Ai is introduced to customer networks. These changes also cascade into the 400G component supply chain.

Wavelogic Ai doubles down on Ciena’s strategy of vertical integration of the DSP and optics, and extends it further into the control plane. The company continues to eschew the use of outside suppliers like Acacia, NTT Electronics, or Clariphy. We believe Ciena’s vertical integration is the company’s strategy for successfully competing with commodity hardware and dis-aggregated networks.
Requires Optical Active Insight subscription

Investor Call – China 2017, CFP2-ACO, Coherent DSPs

Piper Jaffray logo

Andrew Schmitt gave an update on the optical equipment and component market during an investor call hosted by Troy Jensen of Piper Jaffray on Tuesday, October 4. Sixty-eight investors participated. An extended Q&A session followed Andrew’s presentation, and topics of interest included:

  • China 100G port volume trends for 2H16 and 2017
  • Huawei’s upcoming 100G technology decisions and supplier purchasing shifts
  • CFP2-ACO shipments and the component & equipment supply chain for this product
  • Coherent DSP R&D developments and supplier updates
  • Updates on direct-detect 100G and PAM-4 development
  • Observations on Infinera, Ciena, Acacia, Inphi, and Clariphy and discussion of potential M&A activity

Following is a summary of the key takeaways, as well as a full transcript of the discussion. Cignal AI clients can also listen to an audio replay.

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ECOC 2016 Notes and Observations

ECOC 2016 Logo

Andrew Schmitt presented at the ECOC (European Conference for Optical Communications) in Dusseldorf, Germany during the week of Sept. 19. No time was wasted during the trip as Andrew fit in well over 30 scheduled meetings with component and equipment suppliers and end users of optical hardware.

The meetings were very productive and we gained new insight in several areas:

  • Huawei’s plans to transition to 100G CFP-DCO technology and what will follow
  • Updates on vendor selection and R&D in coherent DSPs
  • Details on the ongoing ramp in CFP2-ACO and the development of this new market
  • Overview of 400G market development
  • More insight into Nokia’s China Mobile optical design win

Requires Optical Active Insight subscription

1H16 Optical Hardware Applications

Our 1H16 edition of the Optical Hardware Applications report has been published.

The Excel file contains:

  • Datacenter Interconnect Hardware market share and forecasts
  • Advanced Switching Hardware market share and forecasts
  • 100G+ Coherent port shipments and market share
  • 100G+ Metro and edge port shipments and forecast
  • 100G+ Port shipments and forecast by speed & technology

Subscribers can download the full excel file, registered users can view updated report information. Analysis is under way – we wanted to share market data with you as it became available.

Report Details Excel

2H15 Optical Hardware Applications

Our initial set of optical equipment results and forecasts for Datacenter Interconnect, Advanced Optical Switching, as well as detailed 100G+ Coherent and non-coherent port shipments have been published in Excel format.

Report information, tracked vendors, and details on categories have also been updated. Subscribers can download the full excel file, registered users can view updated report information.

Report Details Excel

Investor Call – China, CFP2-ACO, ROADMs & More

Piper Jaffray logo

Andrew Schmitt created some excitement when he spoke about optical component and equipment market trends on a Piper Jaffray investor call on April 22. 83 investor clients were on the line, and some insightful questions were posed to Andrew as he gave his observations on a wide range of topics. The following is a full transcript of that discussion.
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