Huawei

Huawei ascends to optical networking prominence in $3.6B market

<Did you see the blaze of light as Huawei’s streaked past Alcatel-Lucent on its way to becoming the top optical networking equipment vendor for the first time in Q3? Upsetting long-term record-holder Alcatel-Lucent, Ovum reported Asia-Pacific markets are tearing up the market segment, especially in China, which Ovum said is propelled by 3g mobile network builds. And when China builds, Huawei benefits. Huawei now leads the optical market by almost 3%, Ovum said.

Clearly on a roll, the Del’Oro group reports Huawei is in second place in the mobile networking market in Q3, still far behind Ericsson, but Huawei’s market share went from 11% last year to 20%.

Overall, the optical networking market is down 10% compared to Q308, but global spending still totaled $3.6 billion in Q3 and a recovery appears to be in progress. Several of the top 10 optical vendors have seen improved revenue (including Cisco, Fujitsu, NEC, Tellabs and possibly Nortel), but ZTE, the other Chinese powerhouse, edged out Fujitso for #4. In the hard-knock life category, Nokia Siemens Networks (NSN) fell from #5 in Q308 to #8th, behind Tellabs, a year later. Comeback-kid Cisco also edged out Ciena to re-enter the top 10.

Huawei and mobile infrastructure: Taking on the heavies

Didn’t we discuss Huawei just last week in the optical arena? Yes we did. Now everybody’s talking Huawei in mobile infrastructure, and not just as the low-cost Chinese telecom equipment purveyor category. Huawei did its time as the low-priced spread, and now grudging respect, even fear among competitors is growing.

The most recent Infonetics Research report on mobile and LTE equipment asked service provider decision-makers in Europe, the Middle East and Africa (EMEA) and Asia-Pac what criteria they use when choosing a mobile infrastructure vendor. The bottom line is that Huawei is on everyone’s radar for good technology and good value for the price, and ZTE is on the rise, too, according to Stephane Teral, Infonetics principal analyst for mobile and FMC.

Infonetics notes that Huawei is overtaking Alcatel-Lucent on many fronts and is nipping at Nokia Siemens Networks’ market position in the mobile infrastructure space. It’s true, however, that the service providers all named NSN in their top three mobile infrastructure vendor lists, and that Ericsson got the highest ratings for service and support (nice news for two vendors that had disastrous quarters).

More 100 GigE edge router positioning, but why?

The news is this: Cisco is doubling the density of its Aggregation Services Router 9000 edge router series, which puts density well above the 100 Gig mark. The new line cards, which will be available in the next few months, have 16 10-gigabit-per-second Ethernet ports.

Cisco is claiming top-dog position at the moment, but its competitors have taken turns with edge router announcements of late. Juniper expects to start trialing 100-GigE cards for the MX 960 edge router before the end of the year. Alcatel Lucent is on a similar timetable. Huawei expects to introduce a 100-GigE line card, as well. So, different day, different vendor announcement.

The bigger question is why? What’s really happening is that vendors are positioning to help service providers engineer the next generation of services, according to CIMI Corp. President Tom Nolle. The approaches equipment vendors are announcing are extremely subtle; the point is to be a player in the network edge carrier build-up.

The likely reason service providers are interested in beefing up the network edge is not to serve up video for over-the-top players more efficiently, but to get into the content delivery network (CDN) business themselves so they get a bigger cut of the revenue, Nolle said. “If a provider is going to get a piece of the action by selling CDN services, they need to provide a better user experience.”

This isn’t the end of the port wars by any means, and who wins the most carrier market share will be interesting to watch.

Nortel wireless fire sale delivers North American footprint to NSN

Nortel’s wireless carrier network infrastructure division may bring in a paltry $650 million if the Nokia Siemens Networks (NSN) deal goes through. By all accounts, NSN — the joint venture of Nokia Corp and Siemens AG — will be getting a really good deal out of Nortel’s bankruptcy. The deal sets a low bar, according to The Wall Street Journal, which is pretty clear, considering Nortel was once valued at $250 billion.

NSN stands to gain Nortel’s CDMA and LTE assets. Nortel’s CDMA unit earned $700 million a year – and that was while it was in decline, according to WSJ. The big 4G LTE migration is supposed to start next year, and NSN is gathering firepower for that.

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Huawei gains optical market share during recession, Asia-Pac build-out

China-based Huawei is at the top of the optical networking vendor pile for the first time in Ovum’s preliminary Q1 2009 results. The bigger news is that this puts Huawei ahead of optical-stalwart Alcatel-Lucent in the first three months of the year, but not for the past 12 months overall. And while optical network spending is down compared to 2008 for the past two quarters, Asia-Pac spending was remarkably strong.

Specific reasons for Huawei’s performance are varied, but they include China’s 3G network build-out race, in which Huawei figures prominently as a vendor of choice, according to Ovum’s Dana Cooperson, VP of optical networking. And like Las Vegas, what’s sold in Asia-Pac is often deployed in Asia-Pac.

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