Optical market hits 6-year high

Last year was the best one for the optical equipment market since 2001, according to analysts. In its fourth consecutive year of growth, the global optical market swelled 19% to reach nearly $14 billion, according to Infonetics Research.

Optical equipment spending was particularly strong in last year's fourth quarter, up 30% from a year earlier to $4.4 billion, said Ovum-RHK. Alcatel-Lucent took $1 billion in optical revenue in that quarter alone. Africa, Europe and the Middle East led global optical spending last year as a $5 billion market, and Ovum suspects emerging markets were a big reason why.

The last equipment vendor to report its quarterly earnings, Ciena, recently upped its outlook for FY 2008 to include a 27% annual revenue growth. That revision came just days before Verizon Business announced it would be using the vendor's CoreDirector optical switch to build an 18-city U.S. mesh network.

One of the few major optical companies to not enjoy a great 2007 was Fujitsu Network Communications, whose optical sales sank by 2% last year because North American carriers in particular transitioned from legacy Sonet gear to DWDM. Still, Fujitsu reportedly won a contract last year in which it will supply Verizon with the latest generation of optical gear: packet optical networking, which enables the migration from Sonet to WDM and Ethernet.