However, the transition to 40 Gbps will be different to previous SONET/SDH upgrades in a number of important ways. Going forward the new 40 Gbps products will have to support primarily IP and increasingly video; a very different traffic content than previous TDM products were designed to carry. In addition, 40 Gbps offerings will have to provide compelling advantages over Ethernet alternatives, since Ethernet now competes with SONET/SDH everywhere, except in the long haul. Also, with 40 Gbps the highest point defined in the SONET/SDH hierarchy, 40 Gbps firms will have to take into consideration that their products will increasingly operate in a DWDM/OTN environment.

All of these changes present opportunities for firms to distinguish themselves in the components and modules marketplace in a way that is no longer possible in the increasingly commoditized 10 Gbps space. But in order to take advantage of these opportunities, component and module manufacturers are going to have to find creative ways to deal with problems such as dispersion, sophisticated modulation schemes and cost effective MSAs. All of these are issues that were raised at the 10 Gbps level, but will become much more critical at 10 Gbps. One especially challenging issue for the growth of the 40 Gbps market is that at this data rate, it no longer operates at the same speed as Ethernet and so cannot directly take advantage of the low-cost Ethernet optics.

This new report from CIR analyzes and quantifies the emerging opportunities for 40 Gbps networking components and modules. In addition, this report includes an in-depth discussion of the strategies being adopted by leading component and module manufacturers to take advantage of 40 Gbps market opportunities, along with a five-year forecast of all the major component and module products in the 40 Gbps space.