Published: 19/08/2016
Author: Greg Collins, Exact Ventures

In 2Q16, the market for IMS equipment (wireline + wireless/VoLTE) grew 18% Y/Y to $604 M.  Growth in the wireless/VoLTE segment outpaced the entire market and accounted for three-quarters of the market for the quarter.  The wireline segment accounted for the remaining one quarter of the market.  We forecast that the total market will grow by 15% in 2016, as wireless/VoLTE investments grow 13% and wireline spending rebounds to grow 22%.

Ericsson retained the market lead in 2Q16 by growing 16% Q/Q to account for 42% of the market.  Ericsson’s revenues were up 40% Y/Y.  Nokia (including the former Alcatel-Lucent) captured 28% of the market during the quarter, nearly even with 1Q16 but down from 44% in 2Q15 when shipments to North America were particularly strong.  Since the acquisition, the former Alcatel-Lucent business suffered due to the transition in North America.  However, the company has not yet seen shipments from its recent wins in China.  Huawei ended the quarter with 15% of the market which is up slightly compared to 2Q15.  Huawei is gaining as VoLTE spreads outside of North America and certain markets in Asia Pacific where it has been excluded from networking business.  In mid-2015, both Huawei and Alcatel-Lucent (now Nokia) have announced significant wins with China Mobile and China Unicom for their VoLTE services.  During the quarter Mitel Mobility (formerly Mavenir) reported 13% Q/Q increase in revenues, and 120% Y/Y, on the strength of sales to T-Mobile USA and to large operators in Western Europe.  As a result, their market share increased from 3% in 2Q15 to 6% in 2Q16.

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