Huawei Tops Alcatel-Lucent in Global Optical Networking Revenue in Q1: Report

Bolstered 3G network build-outs in China, Huawei Technologies posted $790 million in revenue during the first quarter of 2009, overtaking rival Alcatel-Lucent for the first time in the coveted global optical networking market, an international telecom research firm is reporting today.

 

Despite its ranking, neither Huawei (News - Alert) nor any of the other top-10 vendors posted either sequential or year-over-year revenue gains, which officials at Ovum say reflects weak spending in this global recession. The global ON market reached $3.6 billion – a 15 percent sequential decline and a drop of 8 percent from the year-ago quarter.

 

According to Dana Cooperson, Ovum’s (News - Alert) vice president of optical networking, the situation could have been far worse.

 

“Spending in Asia-Pacific was surprisingly strong,” Cooperson said. “We did not see the seasonal decline we normally expect in China, for example, as the race to build 3G mobile networks and support them with transport capacity obliterated any seasonality or macroeconomic downturn factors.”

 

Huawei – which last summer also overtook Alcatel-Lucent (News - Alert) in IP DSLAM ports – improved its market share not only through China but also India, which as seen teledensity growth, a stable currency and hasn’t suffered from exposure to what Cooperson called “the cool North American market.

 

Alcatel-Lucent, she said, “suffered from much of the opposite.”

 

That North American market now is led by Fujitsu Network Communications, which has picked up market share in two of the continent’s optical multiplexers – metro wavelength division multiplexing, or “Metro WDM,” and reconfigurable optical add-drop multiplexing, or “ROADM (News - Alert)” – sectors that form nearly 60 percent of the overall market.

 

Despite the global Q1 declines in optical networking revenue, companies such as Ericsson, Huwaei and NEC (News - Alert) beat the sequential and year-over-year averages, Ovum says, and ZTE even saw revenues grow by 40 percent sequentially.

 

Overall, Alcatel-Lucent held on to the market lead with 21.7 percent annualized share, but Huawei picked up 1.8 percentage points to come within 3 points of the market leader at 19.1 percent share.

 

“Given the continued strength of spending in markets where Huawei is strong, its light exposure to weaker markets, and the firm’s seemingly bottomless availability of financing, this looks like a huge year for the Chinese giant,” Cooperson said.