Monday, March 24, 2003

Corning Estimates a 50% Decline in Worldwide Fiber Market for 2002

Monday, March 24, 2003    

Corning Optical Fiber estimates that the total worldwide fiber market was approximately 55 million fiber kilometers last year, representing an overall decrease of approximately 50% compared to 2001. In its annual overview of the fiber and photonics industry, Corning issued the following fiber market assessments:

  • North America, which accounted for 25% of the total worldwide fiber demand, declined by approximately 65%;


  • Western Europe, representing 10% of the worldwide demand, declined by approximately 75%;


  • Japan, representing 30% of the worldwide demand, decreased by nearly 10%;


  • "Other Asia," which represented 30% of the worldwide demand, decreased by about 35%;


  • Latin America and "Rest of World," which comprised 5% of the worldwide demand, declined by approximately 70%.


    • When the market is analyzed by application category rather than by geography, Corning's estimated rates of decline for 2002 are as follows:

  • Long-haul terrestrial/submarine fiber, accounting for 10% of the total worldwide demand, showed a decline of approximately 70%,


  • metro fiber, representing 45% of the total worldwide demand, decreased by approximately 50%;


  • access fiber , representing 40% of the total worldwide demand, showed a decrease of about 45%;


  • and premises fiber, accounting for 5% of the total worldwide demand, decreased by 25%.



Corning expects little change in the worldwide fiber market for 2003.


As for the worldwide market for photonic components and modules, Corning estimates that, after nearly 50% growth in 2000, optical system spending, which includes WDM and SONET/SDH equipment, declined by approximately 60% in 2002, largely due to a 74% decline in optical system spending in North America. Corning expects the DWDM system market to decline a further 15-25%.


Nevertheless, Corning predicts that bandwidth demand will continue to grow at 60-80% annually through 2006. It continues to believe that the world's networks are still in the early stages of a long-term technology substitution from copper to fiber. Another positive note for Corning: in the recent FCC UNE Triennial Review, ILECs were relieved from unbundling requirement for new and overbuilt FTTH deployments.


A webcast is available online.
http://www.shareholder.com/corning/presentations3-25-03.cfm