Communications T&M Vendors Retool Under The Weight Of Slow Markets

June 16, 2003
Growth in segments of the communications test equipment market will likely remain small if not flat. Specifically, 2002 global revenues for wireless test equipment, which were $1.3 billion, are expected to remain flat in 2003. The increasing...

Growth in segments of the communications test equipment market will likely remain small if not flat. Specifically, 2002 global revenues for wireless test equipment, which were $1.3 billion, are expected to remain flat in 2003. The increasing popularity of voice over IP (VoIP) will likely drive test-equipment sales nominally this year, up from the 2002 global revenues of $119.2 million.

Optical test-equipment vendors are going back to the drawing boards, as they reel under the impact of the industry's worst downturn over the past 24 months. They're dusting themselves off to focus on the few emerging opportunities, which may involve optical component and device manufacturers. Specifically, test equipment for design and verification offers potential in the short- to mid-term. Other opportunities should come from the areas of Gigabit Ethernet and Fibre Channel test. On the services side, metropolitan-area network (MAN) implementation looks promising.

There's also optimism in the wireless test world. As 3G and next-generation wireless rollouts gain in popularity, they'll give a much-needed boost to test-equipment vendors. Additionally, the continued deployment of networks in the Asia-Pacific region is driving sales for wireless test equipment.

Most developments by test-equipment vendors have focused on protocol testing, catering to the advanced needs of their end users—whether it's simulating the performance of networks or testing for interoperability between network elements. These are essential to ensure the transition from the trial stage to commercial realization of 3G services for network operators.

VoIP is slowly becoming a reality among many private enterprises and carriers. Increased deployment of VoIP networks among service providers and enterprises will occur in the short term. Demand is growing for pre-deployment test equipment by tier 2 engineers, which will undoubtedly benefit the test industry. The Asia Pacific region once again is a vital player, with increased interest in and the deployment of VoIP, creating valuable opportunities.

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