How to avoid overpaying for optical transceivers

Old habits die hard, especially when it comes to buying network gear and accessories based on long-standing procurement practices. While it may seem easier to sustain the status quo, doing so can expose you to undue costs created by manufacturer price-gouging practices.

Case in point: Optical transceivers, which Gartner says accounts for 10 to 15 percent of enterprise network capital spending. This may not seem like a big budget buster, but huge markups on optics is the subject of a new Gartner report, entitled “How to Avoid the Biggest Rip-Off in Networking.”

After looking at different system integrator and manufacturer pricing strategies, as well as customer buying habits, Gartner observed enterprises regularly overpay for transceivers by 50 percent or more. Massive markups are part of the problem, compounded by the fact that manufacturers like to fuel fear, uncertainty and doubt (FUD) around the legitimacy of third-party optics. 

This argument, however, falls flat, as the overwhelming majority of transceivers sold across the networking ecosystem essentially come from the same place. Most manufacturers, systems integrators, resellers and independent network solution providers rebrand optics obtained from Finisar, the world’s largest supplier of optical communication products. 

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