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Worldwide demand for DSL equipment is growing, strongly buoyed by take-up in Europe and China.

But as demand increases the cost of kit is coming down.

"Cost is clearly the key in the DSL equipment market," said Jouni Forsman, principal analyst for Gartner's worldwide Telecommunications and Networking group.

"The average vendor revenue per port dropped from $95.90 in the first quarter of 2003, to $84 in the second quarter, and in the following quarters, prices will continue to be challenged," said Forsman.

Some 9.8 million DSL modems were shipped in the last quarter - and increase of 81 per cent on the same quarter last year and up 16 per cent on Q1.

Customer premise equipment (CPE) shipments increased 59.5 per cent compared to the same quarter last year (16.2 per cent quarter over quarter) to 8.1 million in Q2 - the third consecutive quarter of record DSL equipment shipments.

Asia/Pacific (driven by an exceptionally strong Chinese market) and Latin America showed the strongest regional growth in the second quarter of 2003, while Japan and North America registered declines.

Gartner also said that Europe showed "robust growth" with the major incumbent telcos pressing ahead with the roll-out of broadband. ®

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