Increasing Investment Into Networking Infrastructure by Web 2.0 Companies Offsets Decline in Capex of Service Providers in 2015

EUGENE, OR--(Marketwired - September 01, 2015) - The top 15 Web 2.0 companies, included into LightCounting Internet Index, collectively spent $19 billion on servers, network equipment, and other property and equipment in H1 2015 -- up 16% from the same period of 2014. Capex of the top 15 telecom service providers dropped by 16% in H1 2015 and it is projected to decline by at least 6% for the year.

The depressed capex is due mainly to the strong dollar. In Europe, network investment is up in Euros, while Japanese operators continue to report revenue growth in yen in the first half of 2015. Another factor for the lower H1 2015 revenues is the weaker performance of the Chinese operators.

LightCounting forecasts that the revenues and capex of the 15 leading operators will be down in 2015. Revenues are forecast to reach $992 million in 2015, down 6% compared to 2014. This is the first decline since 2009 and the first time revenues have dipped below one trillion dollars since 2010. Capex is forecast to total $184 billion in 2015, also down 6% compared to 2014.

These trends in infrastructure spending, along with the latest sales data reported to LightCounting by leading suppliers of optical components and modules provided the basis for August 2015 Market Forecast and Database.

“It will take a very strong Q4 to keep the optical networking market growth on track in 2015," commented Dr. Vladimir G. Kozlov, CEO and Founder of LightCounting Market Research. “Some of the big 100G projects were pushed out to the very end of the year. Any further delays will derail LightCounting latest projections for 25% growth in sales of optical components and modules this year. Another concern is ability of suppliers to keep up with strong demand for FTTx optics and some of the new products such as DWDM CFP transponders.”

More information on the report is available here.

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LightCounting is a leading optical communications market research company, offering semiannual market updates, forecasts, and state-of-the-industry reports based on its analysis of primary research with dozens of leading module, component, and system vendors as well as service providers and other users. LightCounting is the optical communications market’s first choice source for the accurate, detailed, and relevant information necessary for doing business in today’s highly competitive environment. Privately held, LightCounting is headquartered in Eugene, Oregon. For more information, go to http://www.LightCounting.com, or follow us on Twitter at http://www.twitter.com/lightcounting.