The optical network equipment market is expected to be driven by growing demand for bandwidth from both business and residential customers. Increasing internet usage for service such as online gaming, video chatting, social media, online shopping etc. is expected to favor market growth over the forecast period. Additionally, increasing demand from business segments particularly financial and government organizations is also expected to provide positive avenues to the optical network equipment market. Significant growth in bandwidth requirements to reduce latency issue and provide smooth data transmission is estimated to fuel market demand.
Gradual increase in the IPTV and broadband connections is also adding up to the optical networking market growth. Increasing optical network infrastructure worldwide such as installation of optical fiber to meet demand for bandwidth-intensive applications is expected to drive the optical network equipment market.
Growing data center interconnection and network access deployments is estimated to positively impact market growth. Additionally, various benefits such as advanced security, high restoration capacity and return on investment, simplified operations and optimized bandwidth connectivity are also expected to propel the optical network.
Growing research investments and continuous technological advancements may offer new opportunities to the optical network equipment market. Adoption of optical fibers, and reconfigurable optical add-drop multiplexer (ROADM) equipment are expected to gradually replace non-optical fiber networks. Main advantages of ROADM includes automatic power balancing, remote configuration based on requirements without affecting the traffic. Rising demand for FTTH has strengthened the growth of optical network equipment market. Various advantages of FTTH such as high speed, reliability and capacity are expected to favor the optical network equipment market. Emergence of Bit-Interleaved Passive Optical Network (Bi-PON) technology which enables a power reduction of 30% over current technologies while improving performance and reducing cost is also expected to provide new market growth opportunities.
High initial deployment cost is a major restrain to market growth however, high bandwidth requirements by the enterprises and government organizations are facilitating the deployment. Limited infrastructure for fiber-optic networks could pose a challenge to the optical network equipment market.
The optical network equipment market can be segmented on the basis of application, technology. Application segment includes Fiber-to-the-home (FTTH) and Fiber-to-the-building (FTTB) optical networks. Additionally, technology segment includes Asynchronous Transfer Mode PON (APON), Gigabit PON (GPON), Broadband PON (BPON), Ethernet PON (EPON). Optical network equipments are majorly used by communication service providers, network operators, enterprises and government.
Key players in the optical network equipment market include Hitachi Communication Technologies Inc., Freescale Semiconductor Inc., Verizon Communications Inc., Huawei Technologies, AT & T Inc., Alcatel-Lucent S.A., Calix Inc., Ericsson Inc., Broadcom Corporation, Inc. Ltd., Motorola Solutions Inc., Mitsubishi Electric Corporation, ECI Telecom Ltd., and Adtran Inc. Market players are increasingly focusing on service, maintenance and support activities to gain competitive advantage over others.
Freescale Semiconductor offers Gigabit Passive Optical Network (GPON), which is a cost-effective, highly integrated solution designed for lower carrier costs and increase adoption of GPON equipment in markets worldwide. Hitachi Communication Technologies Inc. offers technology for advanced wireless networks such as 4G Evolved Packet Core and small cell solutions. The company also offers high-speed optical networking equipment for metro and data center applications, software platforms for subscriber “connected home” and “machine-to-machine” (M2M) applications deployment and management.
In March 2015, Mitsubishi Electric Corporation developed distributed feed-back (DFB) laser diode for 25 Gbps optical-fiber communication to enhance communication performance in data centers. These diodes can offer high modulation wave form and wide-range of temperature operability to simplify the 100 Gbps transmission system. Ericsson offers Marconi OMS family set for Ethernet, SDH and PDH traffic and provides efficient and economical transport and aggregation fixed, mobile, residential and business services. .Motorola offers Passive Optical LAN (POL) based on Gigabit Passive Optical Networking (GPON) technology which simplifies network deployment, operation, and management, while delivering enhanced security, carrier-class reliability, and significant power savings.
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