Market transformation ahead

Tom Nolle/CIMI Corp.
14 Dec 2009

There's never any shortage of predictions that the coming year will be revolutionary for the industry, but some developing telecom industry trends for 2010 show clear signs that the coming year may well be the most transformational in recent memory. Technology, service provider purchasing policies, equipment vendor strategy and consumer/enterprise spending trends are all in a state of flux. Any one of them could create a major shift in the market. All of them together could create a market transformation of historic proportions.

Given all that could happen, here are the five critical telecom industry trends most likely to have an impact on planners, buyers and sellers in 2010 and beyond. That all of these trends will exert some influence in 2010 isn't a chance; it's a certainty. If all are as pronounced as they promise to be, they will create a radical shift in the practice of network infrastructure deployment and exploitation. That will create the largest set of incremental opportunities we have seen in a decade or more.

Top five telecom industry trends for 2010:

1. Commoditization pressure on the lower network layers. As fiber transport gets cheaper, the value of running fiber directly to points of traffic concentration increases. The trend to fiber-connect cell tower sites, for example, constitutes a good strategy in preparing for 4G rollout.

The same pressure is generating interest in creating agile optical networks and opto-Ethernet hybrid networks that would reduce complexity and management costs in part by creating a larger capacity pool to reduce concerns about congestion and traffic engineering. Some very large network operators are already issuing requests for information (RFIs) on this structure for their core networks, with some considering it in metro deployments as well. In 2010, the formulation of a new transport architecture based on optical and opto-Ethernet advances will create both risks and opportunities for vendors but will certainly cause a major shift in operator procurements.

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