Telecoms in 2020: components
Ovum’s vision for the long-term future of telecoms component suppliers based on the core Telecoms 2020 scenario includes adding power consumption as a critical differentiator; developing multi-level transmission products for the network core; establishing high-volume, low-cost strategies for products currently in the network core as they are tomorrow’s access products; increasing optoelectronic integration; and establishing greater cooperation up and down the food chain.
Executive summary
In a nutshell
Scope
Ovum view
Innovation required to move hotspot components onto different curves; cannot rely on Moore’s Law
Multiple hotspots span core and access networks
Industry structure generally in good shape but needs to slim down in FTTx
Greater industry cooperation increases development efficiency
Key messages
Recommendations for components market players
Telecoms components in 2020 – the broad view
Components are key enablers for LEAN operators in 2020
Components industry overview
Transport will use complex transmission and signal processing
Broadband access in 2020 will be fiber-based
Packet-processing technology will be pushed for power reductions
Technology roadmaps
Optoelectronic integration moves from today’s high-end to volume markets in 2020
Cross-silo design optimization represents new potential to exploit
Power savings will come to the core network relatively late
As services become more content-centric, storage continues to be the alternative to network transit
Larger semiconductor roadmap has tools to borrow
Component industry structure/player positioning
Components require supporting ecosystem to thrive
Vertical integration down to chip level is costly but beneficial
Competition from system OEMs is a reality
Horizontal integration between optical component markets leads to many choices
Combining optics and electronics in one supplier – time to try again?
SWOT analysis of telecoms components in 2020
Strengths
Weaknesses
Opportunities
Threats
Components suppliers
The world of 2020
End devices and programmability will keep large semiconductor vendors in telecom
The core network will continue to rely on mid-sized specialty semiconductor houses
Components supplier development timeline
Development timeline
2009–2012
2013–2016
2017–2020
Components customers and markets
Increasing collaboration on roadmap
The world of 2020 by segment
WAN customers
Datacom customers — Cisco dominates
Access customers
Preference for local vendors
Continued rise of China
Japan as a market is closed
Indian system vendors push for domestic components
Components services, revenues, and margins
The world of 2020
Best-in-breed products
Discrete components, modules, subsystems: where’s the beef?
Optoelectronic integration
Best-in-breed service
Components market development timeline
Development timeline
2009–2012
2013–2016
2017–2020
In a nutshell
Scope
Ovum view
Innovation required to move hotspot components onto different curves; cannot rely on Moore’s Law
Multiple hotspots span core and access networks
Industry structure generally in good shape but needs to slim down in FTTx
Greater industry cooperation increases development efficiency
Key messages
Recommendations for components market players
Telecoms components in 2020 – the broad view
Components are key enablers for LEAN operators in 2020
Components industry overview
Transport will use complex transmission and signal processing
Broadband access in 2020 will be fiber-based
Packet-processing technology will be pushed for power reductions
Technology roadmaps
Optoelectronic integration moves from today’s high-end to volume markets in 2020
Cross-silo design optimization represents new potential to exploit
Power savings will come to the core network relatively late
As services become more content-centric, storage continues to be the alternative to network transit
Larger semiconductor roadmap has tools to borrow
Component industry structure/player positioning
Components require supporting ecosystem to thrive
Vertical integration down to chip level is costly but beneficial
Competition from system OEMs is a reality
Horizontal integration between optical component markets leads to many choices
Combining optics and electronics in one supplier – time to try again?
SWOT analysis of telecoms components in 2020
Strengths
Weaknesses
Opportunities
Threats
Components suppliers
The world of 2020
End devices and programmability will keep large semiconductor vendors in telecom
The core network will continue to rely on mid-sized specialty semiconductor houses
Components supplier development timeline
Development timeline
2009–2012
2013–2016
2017–2020
Components customers and markets
Increasing collaboration on roadmap
The world of 2020 by segment
WAN customers
Datacom customers — Cisco dominates
Access customers
Preference for local vendors
Continued rise of China
Japan as a market is closed
Indian system vendors push for domestic components
Components services, revenues, and margins
The world of 2020
Best-in-breed products
Discrete components, modules, subsystems: where’s the beef?
Optoelectronic integration
Best-in-breed service
Components market development timeline
Development timeline
2009–2012
2013–2016
2017–2020
LIST OF TABLES
Table 1: Key events and drivers summary – components suppliers
Table 2: Key events and drivers summary – components market
Table 1: Key events and drivers summary – components suppliers
Table 2: Key events and drivers summary – components market
LIST OF FIGURES
Figure 1: Evolution of telecom industry structure
Figure 1: Evolution of telecom industry structure
