As noted in last week’s news story on SearchTelecom.com, operators need to be mindful of the mergers and acquisitions likely to come in this very young LTE equipment market. That’s because when we say young, we don’t mean a cute and gurgly baby opening its eyes to a new world young. We mean an immature, volatile, unpredictable, door-slamming young teenager — full of indie microwave vendors that are driving down prices and becoming attractive M&A targets for bigtime packet core (rather, evolved packet core in LTE) players.
And it just got more grouchy: Despite an uptick in shipments, revenues in the point-to-point microwave equipment market declined 3% year-over-year in the first quarter of 2010 partly due to falling prices, according to a report by Dell’Oro Group released today.
It was an especially gloomy year for microwave in Europe, the Middle East and Africa (EMEA), where revenues sunk 13% year-over-year, according to Jimmy Yu, senior director of microwave transmission research at Dell’Oro Group.
“Microwave market revenues declined in the first quarter partly due to heightened competition among vendors that resulted in steep price declines, [which] overrode the 14% growth in radio unit shipments,” Yu said. “In addition, demand in EMEA, especially Europe, was low as a result of the persistent economic distress affecting certain European countries.”
North America was “a bright spot for the market,” growing 50% year-over-year as a result of the large WiMAX deployment by Clearwire in the U.S., Yu said. The other good news came from the newest market segment, packet microwave (for which Huawei has a neat little primer), which grew 15% from the fourth quarter of 2009 to the first quarter of 2010.
Ericsson ranked No. 1 with 22% of the microwave market revenue share for 1Q10, followed by NEC at 15%, Huawei at 12% and Alcatel-Lucent picking up the rear at 10%.
Image courtesy of CNBC.