Optical Networking, Redefined.
January 7, 2019

The Truth About NEMs: What They Aren’t Telling You

Optical transceivers are an integral part of today’s networks, comprising up to 15% of a company’s capital expenditures. Unfortunately, many organizations are significantly overcharged for these parts by Network Equipment Manufacturers (NEMs). Due to aggressive sales tactics and widespread misconceptions, many executives continue to spend more money than they should for their optics. Fortunately, Precision OT has good news – by choosing our optics, you can save significant capital costs while receiving cutting-edge, NEM-compatible products that are customized to meet your specific network needs. In this blog, we’re going to highlight just how expensive NEM transceiver pricing can be, how to steer clear of myths like the “NEM warranty scare” and how to buy quality transceivers without spending a fortune.

Stop Breaking the Bank

We all want to make the best purchasing decisions. As a result, the existence of a name brand option will often pull us to spend because we feel we are likely to receive a superior product. This same psychology attracts many enterprises to NEMs for their transceiver needs. However, did you know that many NEM-branded products aren’t necessarily made by the NEM itself? In fact, many brand-name manufacturers purchase optical transceivers from third-parties.  The equipment becomes NEM-branded only because the NEMs test the transceivers they purchase to ensure they work with their equipment.   

More importantly, our own experience in the transceiver market consistently shows that NEM markup requirements are typically between 60% – 80%. In fact, a Gartner report found some NEMs charging upwards of $450 for branded transceivers when the same equipment only costs them between $100 and $250 to purchase from their supplier. When you factor in how many transceivers could go into an optical network, many enterprises really are spending a fortune just to have a name brand product. On the financial aspect alone, it therefore makes sense to start considering alternatives to NEMs.

One reason why many executives are hesitant to do this is because of the “NEM warranty scare.” Many NEMs actively pressure customers not to use third-party transceivers. From a brief search of various NEM warranty policies available online, it becomes clear that many NEMs warn they will restrict or withhold warranty services if they believe that a customer’s troubles are the result of non-NEM, third-party products.

So how can companies avoid high NEM markup and warranty scares while ensuring that they acquire quality transceivers that can still work with other NEM components? Here is what Precision OT offers!

Your Trusted Source for Transceivers and Related Optical Equipment

At Precision OT, we meet customer requirements for top-quality, cost-effective and NEM-equipment-compatible products without the NEM price tag. We invest in developing, engineering and qualifying transceivers so our customers receive the best product for their networks. Because we are not beholden to the type of markup NEMs pursue, we can sell the same quality parts for less money. Furthermore, our extensive inventory allows for short lead times and same day shipment upon request. With cutting-edge programming and diagnostic technologies in our lab, our team of expert engineers offers the widest variety of cost-effective, NEM-compatible transceivers available on the market.

Moreover, we take customer service seriously; we never leave our customers hanging because they might use transceivers and routers from different vendors. We always work with our customers to identify problems regardless. In fact, we proudly offer a lifetime warranty and guarantee 100% compatibility for all our products.

Finally, our team strongly values eliminating vendor-lock and improving competition and choice for network operators in the markets we serve. In fact, last month, we even unveiled a new machine learning-powered software-defined networking (SDN) application named Lightseer® to assist administrators in monitoring and analyzing their transceivers. Notably, our product is compatible with a wide variety of open-source white box networking equipment and off-the-shelf SDN controllers. That’s just one example to highlight the key takeaway – that with Precision OT, you can get high-quality optical equipment at significantly lower prices than typical NEM markup, all backed by a reliable warranty.

In short, you can’t lose by contacting us today and finding out how our transceivers can be put to work in your networks. Visit our products pageand email us your questions at info@precisionot.com.