Ceragon Networks Ltd 's Comment on Competitors and Industry Peers
The market for wireless equipment is rapidly evolving, fragmented, highly competitive
and subject to rapid technological change. We expect competition, which may differ
from region to region, to persist, intensify and increase in the future - especially
if rapid technological developments occur in the broadband wireless equipment
industry or in other competing high-speed access technologies.
We compete with a number of wireless equipment providers worldwide that vary
in size and in the types of products and solutions they offer. Our primary competitors
include large wireless equipment manufacturers referred to as generalists, such
as Huawei Technologies Co., Ltd., L.M. Ericsson Telephone Company, NEC Corporation,
Nokia and ZTE Corporation. In addition to these primary competitors, a number
of other smaller wireless backhaul equipment suppliers, including Aviat Networks,
and SIAE Microelectronica S.p.A offer or develop products that compete with
our products.
We also expect consolidation to continue as the wireless equipment market continues
to be highly competitive and, as a result, we face strong price pressures. We
expect to continue to be a leader in the best-of-breed segment of the wireless
backhaul market in terms of market share, technology and innovation, providing
significant value to our customers.
We expect that continued market pressures will drive further consolidation
within equipment manufacturers competing with us and which focus solely on the
best-of-breed segment of the wireless backhaul market. Examples of such previous
consolidations are our acquisition of Nera Network AS in 2011 (the “Nera
Acquisition”), the acquisition by Dragonwave of the wireless division
of Nokia (formerly NSN), and the merger of the wireless divisions of Harris
and Stratex Networks.
We expect further consolidations will take place within the generalists; the
most recent is the merger between Nokia and Alcatel-Lucent, while Nokia itself
is the result of a previous joint venture between Nokia and Siemens, and Alcatel-Lucent
is the result of a previous merger between Alcatel and Lucent.
Further market consolidations among industry generalists may drive some operators,
which seek best-of-breed solutions, to seek “bundled” network solutions
from these generalists. This trend may put an additional strain on our competitiveness.
We believe we compete favorably on the basis of:
our focus on the mobile market and active involvement in shaping next generation
standards and technologies, which deliver best customer value;
product performance, reliability and functionality, which assist our customers
to achieve the highest value;
range and maturity of product portfolio, including the ability to provide solutions
in every widely available microwave and millimeter-wave licensed and license-exempt
frequency, as well as our ability to provide both circuit switch and IP solutions
and therefore to facilitate a migration path for circuit-switched to IP-based
networks;
cost structure;
focus on high-capacity, point-to-point microwave technology, which allows us
to quickly adapt to our customers’ evolving needs;
range of rollout services offering for faster deployment of an entire network
and reduced total cost of ownership;
support and technical service, experience and commitment to high quality customer
service, and
our ability to expand to other vertical markets such as oil and gas and public
safety, by drawing upon the capabilities of our technologies and solutions.
Our products also indirectly compete with other high-speed communications solutions,
including fiber optic lines and other wireless technologies.