CAMBRIDGE, Mass., Mar. 9 -- Long-term demand for optical switching systems in the global telecommunications marketplace is set to boom, according to a report from Pioneer Consulting. In North America and Europe, where dense-WDM-based fiber optic networks are being rapidly deployed, the report sees the need for optical switching systems creating a 5-year, $31-billion market opportunity for vendors of these systems. The North American market for the systems is expected to expand from a projected $427 million in 2000 to over $10 billion in 2004. The European market forecast predicts growth from $116 million in 2000 to over $4 billion in 2004. In total, Pioneer Consulting expects more than $31 billion to be spent in the next five years on optical switching systems in North America and Europe.
An important opportunity is emerging in the optical networks market in the coming decade, driven by the widespread deployment of dense WDM systems for backbone capacity expansion, said Scott Clavenna, principal analyst at Pioneer Consulting and author of the report, Core Optical Networks: Market Opportunities for Optical Switching Systems in DWDM Networks. This deployment has resulted in a need among carriers to manage these multiwavelength networks in a much more efficient and economical means than is possible today using existing optical network gear. The range of solutions being offered by existing and start-up equipment vendors range from optical switching systems to ultra-long-haul dense WDM transport solutions. What they have in common are value propositions that offer carriers dynamic management of their optical layer networks, rapid optical service provisioning, and reduced operations costs.