Vertical Systems Group: Orange, Colt, Verizon have greatest Ethernet share outside home market

CEN Feature (Sep 7 2010)

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   Carrier Ethernet may be hot in the U.S.--but it’s even hotter in some other world regions, notes Rick Malone, principal with research firm Vertical Systems Group.

    

   Vertical Systems has a unique way of looking at the global Ethernet market. It tracks the number of connections a carrier sells outside its home market. Using that measurement, the firm’s data shows France-based Orange, U.K.-based Colt and U.S.-based Verizon as the top three global Ethernet carriers.

    

   Vertical Systems doesn’t share detailed market data, but Malone said all three of these carriers--as well as AT&T, NTT and Tata Communications—have market share of 4 percent or more. All of these carriers saw their total number of Ethernet connections outside their home markets increase in the first half of 2010. Verizon saw the greatest increase, experiencing the largest port share gain among providers with at least 4 percent market share.

    

   “Verizon has been very aggressive in the last 12 months in pushing multi-national networking products,” Malone said. “Part of it is that they responded to a number of requests in the Asia-Pacific region.” Growth in that region is particularly strong, driven by an increase in inter-country connections, he added.

    

   Both Orange and Colt were early players in the Ethernet market. Orange had a lead in the international data market through its ownership of the former Equant network and has exploited that lead by branching into new technologies. “They took that packet-switched network and evolved into VPN services,” said Malone. “They have a significant presence not only in Europe, but other countries as well. They have a lot of network reach and exploited that in the introduction of Ethernet services.”

    

   Colt was one of the early pioneers in Ethernet and fiber technologies, noted Malone. “They saw an opportunity in data networking and built the company from the ground up.” The service provider’s ongoing success is built on its extensive fiber assets in Europe, he added. “Colt is exploiting how penetrated they are within the European cities.”

    

   One of the issues for Colt going forward will be whether it will expand beyond its home region. “They have opportunities now to grow beyond Europe and make significant moves into growth regions in Asia and just beginning in South America,” Malone said.

    

   The growth of Ethernet also is attracting new players to the global Carrier Ethernet market. “Most are domestic players expanding their reach outside their home countries rather than someone who comes in to be a global player day one,” he said.

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