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Infinera‘s Optical Transport Solutions are making waves

04 Nov Infinera‘s Optical Transport Solutions are making waves

Infinera (NASDAQ: INFN), a leading optical transmission solution provider, announced that its 7300 Multi-haul Transport PlatformmTera Universal Transport Platform, and Transcend software-defined networking (SDN) solution were adapted by Gtd, a Chilean multi-service telecommunications provider with operations in Chile, Colombia, Peru, and Spain. The systems will be used to increase its capacity across its territorial network in Chile, and its subsea submarine optical fiber project named “PRAT”, to provide high-quality internet for wholesale, enterprise, and residential customers.

Gtd currently operates subsea and terrestrial internet networks, providing high connectivity and fixed mobile phone services through seven data centers. The deployment of Infinera’s systems will enable it to offer more efficient networking solutions, which are SDN-ready, highly scalable, and resilient, for its local customers, in addition to providing services such as data center interconnect, private cloud, and high-speed internet access. Infinera’s solutions will offer reliability of nearly 99.999% and improve uptime for Gtd’s customers.

Infinera (NASDAQ: INFN)

Market Cap: $1.018B; Current Share Price: 5.675 USDChart
Data by YCharts

Bob Jandro, Senior Vice President, Worldwide Sales at Infinera commented,

“We are pleased to work closely with Gtd and Raylex to meet Gtd’s commitment to delivering innovative, high-quality communications. Infinera’s combined solutions enhance Gtd’s national network and deliver the capacity, resiliency, and security required to achieve Gtd’s network goals.

The Company worked closely with a local partner Raylex to assess and assist Gtd in finding the right solutions for its network requirements.

Industry
The advent of the internet and rapid globalization is driving the demand for high-quality, reliable data transmission. Increased adoption of IT–based solutions, the need for networking in almost all spheres of life and growing demand for mobile and internet services are other factors which are contributing to the growth in the industry. Optical transmission is rapidly emerging as one of the fastest growing industries owing to reliability and ease of implementation. Wavelength Division multiplexing is emerging as one of the most focal segments of the global optical equipment market.

WaveLength division multiplexing is a technology that regulates varied data streams and wavelengths of laser light, onto a single optical fiber. It not only enables bi-directional communication but also facilitates multiplication of signal capacity. The system uses a multiplexer to join multiple signals together and a demultiplexer to split them apart. They are extremely popular and much sought after as they allow telecommunication players to expand their network offering, without having to lay down actual fiber. These enable the telecommunication provider to assimilate technology development in their existing optical structure and increase or decrease the capacity of a link, without having to make any changes to the existing network.

According to a report by Acumen Research and Consulting, the global coherent optical equipment market will be worth over 70.14 billion by 2026, growing at a CAGR of 9.23 percent, from 34.61 billion in 2018. This offers a great opportunity for Companies such as Infinera to gain a strong foothold in the market.

Company
Infinera is the creator of the industry’s first point-to-multipoint coherent optical subcarrier aggregation technology. The Company offers diverse solutions encompassing areas such as Intelligent Automation, 5G, Fiber Deep, DAA , cloud networking, business services, access and aggregation, in addition to core and subsea networks.

The Company’s offerings caters to the end-to-end need for networking solutions of Tier 1 carrier, internet content provider, cable operator, government, and enterprise networks worldwide, by using technology innovation. Infirnera’s end-to-end, multi-layer packet optical and IP transport solutions facilitate scaling of bandwith on demand, accelerate service provisioning, and automate operational tasks as per the Company.

Image Source: Company

Infinera’s proprietary vertically integrated Infinite Capacity Engine (ICE) allows the Company to offer economic and robust performance in the long-haul, subsea, data center interconnect, and metro transport applications. The services of the Company range from optical line systems, packet optical transport systems, compact modular platforms, carrier-grade routers, and management and automation solutions.

The Company offers differentiated photonic integrated circuit (PIC) and application-specific integrated circuit (ASIC) chips, which have been developed in-house. Infinera services nine of the top 10 global Tier 1 service providers, the top six ICPs, cable multiple systems operators (MSOs), cloud and data center operators, enterprises and government agencies according to the Company. It offers the lowest Total Cost of Ownership (TCO) and a “pay as you win” instant bandwidth operational model and has a customer base of over 500 clients worldwide, spanning six continents in more than 100 countries. The intellectual property portfolio of Infinera has more than 2000 patents.

Risk Assessment

  • Infinera is planning a footprint expansion in 2019, along with considerable integration synergies. As per the Company its integration with Coriant has resulted in more than $100M in synergies. The increased scale has enabled the Company to improve its order fulfillment and pipeline on one hand and has contributed to higher sales volume and margin expansion.
  • The Company has scored strong orders in 2019 with multiple Tier 1 and ICP contracts which have helped in the growth of its pipeline. It is the only vendor that offers both 600G and 800G solutions. It has many firsts to its credit including the evolution towards Compact Modular and DRX design award winning IP disaggregated solutions, which acts as a differentiator from its competitors.
  • Infinera has closed its Berlin manufacturing operations and is using the services of Fabrinet, a contract manufacturer of optical communications equipment. This would help it reduce costs and focus on other important aspects of business.
  • The Company claims to be on track with respect to realization of integration synergies on account of its acquisition of Coriant. However the Company will have to account for challenges it may face, in successfully integrating its ICE offerings with Coriant’s products, to reach its target of $250 million in merger synergies by 2021.
  • Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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    Source:          

    https://www.globenewswire.com/news-release/2019/10/29/1936948/0/en/South-America-s-Gtd-Increases-Capacity-with-Infinera-s-Optical-Transport-Solutions.html

    https://www.cso.com.au/mediareleases/35996/coherent-optical-equipment-market-demands/

    http://www.globenewswire.com/news-release/2019/04/10/1802104/0/en/Coherent-Optical-Equipment-Market-Size-Worth-Around-USD-70-14-billion-by-2026-Acumen-Research-and-Consulting.html

    https://www.infinera.com/wp-content/uploads/End-to-end-Packet-Optical-Transport-Solutions-0024-BR-RevA-0419.pdf

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