Analysis of the Global Bit Error Rate Tester Market SONET/SDH and Ethernet Over SONET Technologies Drive

Market Growth

Global

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January 2013

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Contents

Section

Executive Summary

Market Overview

Total Market

• External Challenges: Drivers and Restraints

• Forecasts and Trends

• Market Engineering Measurements

• Total Market Revenue Forecast

• Revenue Forecast by End User

• Revenue Forecast by Application

• Revenue Forecast by Distribution Channel

• Market Share and Competitive Analysis

• Market Share Analysis

• Competitive Environment

• Top Competitors

• Competitive Factors and Assessment

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Contents

Section

Traditional BERT Segment Breakdown

• Market Engineering Measurements

• Revenue Forecast

• Revenue Forecast by End User

• Revenue Forecast by Application

• Revenue Forecast by Distribution Channel

• Market Share Analysis

• Competitive Environment

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Contents

Section

Functional BERT Segment Breakdown

• Market Engineering Measurements

• Revenue Forecast

• Revenue Forecast by End User

• Revenue Forecast by Application

• Revenue Forecast by Distribution Channel

• Market Share Analysis

• Competitive Environment

The Last Word (Conclusions and Implications)

Appendix

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Executive Summary

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Executive Summary

• The global bit error rate tester (BERT) market is expected to grow at a compound

annual growth rate (CAGR) of 7.3 percent from 2011 to 2018.

• The growth of the market is expected to rise due to the use of more multi-functional

BERTs and modular BERTs going forward.

• Emerging regions are expected to witness the highest growth in the BERT market

among the four regions mainly due to government initiatives.

• Latest evolutions of key technologies that are likely to spur market growth include

Synchronous Optical Networking (SONET)/ Synchronous Digital Hierarchy (SDH) and

Ethernet over SONET (EoS), as well as the deployment of 40 and 100 gigabit networks.

• Demand for stand-alone BERTs is expected to decrease due to the increase in

complexity of networks and chip density.

• With the increase in technology complexity, the lack of customer knowledge is a

significant challenge in certain countries, and vendors need to take initiatives to educate

end users.

• Price, features, ease of use, and modularity are key competitive factors in the BERT

market today.

Source: Frost & Sullivan analysis.

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Market Overview

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Market Overview—Definitions

Source: Frost & Sullivan analysis.

The global bit error rate Tester (BERT) market is segmented into the following two product segments:

• Traditional BERT or unframed BERT

• Functional BERT or framed BERT

The geographic scope of this study includes the following regions:

• North America: Canada and the United States

• Europe: Western, Central, Eastern Europe and Russia

• Asia-Pacific: countries that are on the western border of the Pacific Ocean (including those on the

Indo-Chinese peninsula), the Pacific Islands, and Central Asia

• Emerging regions: regions such as Central and South America, the Caribbean Islands, the Middle

East, and Africa.

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Market Overview—Definitions (continued)

Source: Frost & Sullivan analysis.

A bit error rate tester (BERT) is a test product used to test the bit error rate (BER) and error frequency

over a communication channel to evaluate its overall performance. BER is often expressed in terms of

“10 to the negative power.” In a network transmission, a BERT analyzes the total bits received against

the total number of bits sent.

Traditional BERTs or unframed BERTs

Traditional BERTs are also termed unframed BERTs. They are primarily used in research and

development (R&D) and manufacturing applications.

Functional BERTs or framed BERTs

Functional BERTs are also termed framed BERTs. Compared to the traditional market segment, many

technological changes are occurring in this market segment. These products find extensive use in

installation and maintenance applications.

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Market Overview—Definitions (continued)

Source: Frost & Sullivan analysis.

The various end-user segments analyzed in this study include:

• Component and system manufacturers (C&SM)

• Service providers (SPs)

• Enterprises

• Others (contract manufacturing companies and government contractors)

The various application segments analyzed in this study include:

• Research and development (R&D)

• Manufacturing

• Installation and maintenance (I&M)

The revenue included in this research study is that generated by BERT vendors from the sale of BERTs.

• Base year: 2011

• Forecast period: 2012 to 2018

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Market Overview—Segmentation

Note: All figures are rounded. The base year is 2011. Source: Frost & Sullivan analysis.

Traditional BERT 62.7%

Functional BERT 37.3%

Percent Sales Breakdown

Total BERT Market: Global, 2011

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External Challenges: Drivers and Restraints—

Total BERT Market

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Drivers and Restraints M

ark

et

Dri

vers

M

ark

et

Restr

ain

ts

1–2 years 3–4 years 5–7 years

Demand for modular BERTs

40 gig and 100 gig network deployments

Increasing competition for stand-alone BERTs

Growth in digital interfaces

BERTs do not cater fully to all end-user

applications

Impact: High Medium Low

Total BERT Market: Key Market Drivers and Restraints, Global, 2012–2018

Source: Frost & Sullivan analysis.

Low educational level in emerging regions

New and emerging standards drive growth

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Appendix

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Market Engineering Methodology

One of Frost & Sullivan’s core deliverables

is its Market Engineering studies. They

are based our proprietary Market

Engineering Methodology. This approach,

developed across the 50 years of

experience assessing global markets,

applies engineering rigor to the often

nebulous art of market forecasting and

interpretation.

A detailed description of the methodology

can be found here.

Source: Frost & Sullivan research.

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Additional Sources of Information on the Test and

Measurement Market

• World General Purpose Test Equipment Markets

• World Oscilloscopes Markets

• Analysis of the Signal Generator and Arbitrary Waveform Generators Market

• High Growth Test and Measurement Market Opportunity: Modular Instruments

• World SONET/SDH-related Test Equipment Market

• North American Modular Instrumentation Markets

• European Modular Instrumentation Markets

• Asia-Pacific Modular Instrumentation Markets

• Emerging Modular Instrumentation Markets

• Global Gigabit Ethernet Test Equipment Market

• North American Gigabit Ethernet Test Equipment Market

• European Gigabit Ethernet Test Equipment Market

• Asia-Pacific Gigabit Ethernet Test Equipment Market

• Emerging Gigabit Ethernet Test Equipment Market

Source: Frost & Sullivan research.

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Table of Acronyms Used

Source: Frost & Sullivan research.

10 GbE—10 gigabit Ethernet

40 GbE—40 gigabit Ethernet

100 GbE—100 gigabit Ethernet

APAC—Asia-Pacific

BER—Bit error rate

BERT—Bit error rate testers

C&SM —Component and system

manufacturers

CAGR—Compound annual growth rate

CAPEX —Capital expenditure

EoS—Ethernet-over-SONET

EU—Europe

FPGA—Field-programmable gate array

HDMI—High-definition multimedia interface

I&M—Installation and maintenance

NA—North America

OTN—Optical transport network

R&D—Research and development

ROW—Rest of World

SONET—Synchronous optical networking

SDH—Synchronous digital hierarchy

SP—Service providers

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Learn More—Next Steps

• Arrange a Growth Workshop

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Jessy Cavazos Industry Director, Test & Measurement

jcavazos@frost.com

Research Team/ Contact Information

Sujan Sami Industry Manager, Measurement &

Instrumentation

ssami@frost.com

Lead Analyst Program Manager and Strategic Review

Committee Leader

Jeannette Garcia Corporate Communications, North America,

Measurement & Instrumentation

Jeannette.Garcia@frost.com

210-477-8427

For more information contact: