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Ovum predicts data centres will drive Global ON market to US$20 billion by 2017

Ovum is projecting an upbeat long-term forecast for sales of optical networking (ON) equipment, driven by new data centre demands. The global research firm expects the ON market to reach US$20 billion by 2017 with a 5% compound annual growth...


July 25, 2012  


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Ovum is projecting an upbeat long-term forecast for sales of optical networking (ON) equipment, driven by new data centre demands. The global research firm expects the ON market to reach US$20 billion by 2017 with a 5% compound annual growth rate (CAGR).

The latest Ovum forecasts show the highest growth region will be Latin America, driven by network modernization efforts to enhance regional connectivity in support of mobile and broadband access network build outs. 

North America is expected to exhibit solid growth as tier-1 network operators embrace new 100G technology to meet growing data centre needs. Growth in Asia-Pacific is expected to continue but will cool a bit after “five years of torrid growth, while the EMEA market is expected to expand, despite the current macro-economic malaise, due to deployment activity in Russia, the U.K., Eastern Europe and Africa.  

“The new bandwidth driver is data centres,” says Ian Redpath, principal analyst in Ovum’s Network Infrastructure practice. “Large-scale data centres continue to be built out.”

The data centres are being placed in brand new locations, creating brand new optical networking demands, according to Ovum: “For example, the new Facebook data centre at Lulea, Sweden, near the Arctic Circle, will require terabits of bandwidth. These new demands are not unique to Lapland – they are emblematic of a trend unfolding in multiple European and North American locations.”

In North America, the “perfect deployment storm” has arrived, Ovum said in a release:  a ridge of high-bandwidth pressure is approaching, networks based on the last generation of technology and 10G have filled up, and the next generation of network technology — 100G — is ready.