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In first-quarter 2008, sales of wavelength division multiplexing (WDM) systems were $1.4bn, surpassing those of SONET/SDH multiplexers for the first time, according to a report by market research firm Dell’Oro Group’s Optical Transport Quarterly Report.

Within the WDM market, the WDM metro segment grew 47% on a year ago and outperformed the DWDM long-haul segment.

“With Internet traffic growing at such high rates, service providers have to build optical networks that can handle enormous traffic volumes today yet can continue to scale in the immediate future,” says Shin Umeda, VP of Optical Transport research. “WDM systems can clearly handle those requirements more economically than legacy SONET/SDH multiplexers,” he adds. “Manufacturers continue to improve the attractiveness of WDM systems by incorporating advanced optical and packet technologies such as ROADM [reconfigurable optical add-drop multiplexers], 40Gb/s, and Ethernet.”

Also, the WDM metro market was highly fragmented in Q1/2008, with seven vendors accounting for over 80% of the market, but with none commanding more than 15% revenue share. Cisco was the market leader, followed closely by Alcatel-Lucent and Nortel.

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