Summary
1. Huawei is quite aggressive in gaining access to new technologies. 2. It studies implementations and figures out if they are viable. 3. Huawei has a few different options available to it at 40G.
Analysis
Although Huawei has three or four different modulation techniques for 40G that it supports, DQPSK is coming online now in the general market at that rate. Eventually, PM-QPSK -- or just straight QPSK will become available, but that is still two years away. Obviously, for 40G, each one of those future implementations cost more than the current ones. They may promise better performance, but until the prices come down low enough to justify deployment for 40G, it is not going to happen against 10G, especially for metro and regional markets.
It is not necessarily clear what Huawei is going to do at 100G. There appears to be apprehension at module vendors including Finisar, Mintera, and Opnext about working with Huawei. There seems to be anxiety about the Chinese vendor possibly engaging in reverse engineering. They do not want to have anything talked about now coming back to bite them in a couple of years.
