Optical Communication and Networking Equipment Market (Updated Version Available)

Key Market Overview:

The Optical Communication and Networking Equipment Market was valued at USD 18.02 Billion in 2022, registering a CAGR of 7.68% during the forecast period (2023-2030), and the market is projected to be worth USD 31.90 Billion by 2030.

Optical communication and networking equipment is referred as a device utilizing signals encoded light to transmit information in a telecommunication network. The networking equipment involve wide area network (WAN) and limited range local-area network (LAN) to facilitate interconnectivity between the networks. The optical networking equipment comprises of optical amplifier, transceiver, tunable filters, and others.
The rapid digitalization has increased internet traffic resulting in rising e demand for reliable internet connectivity. Thus, the rising need of internet connectivity is driving the growth of the optical communication and networking equipment market. Additionally, technological developments including artificial intelligence, machine learning, IoT, and big data analytics leading to the rise in demand for smart devices and other connected devices which in turn drives the market growth of optical communication and networking equipment market.

Furthermore, companies are focusing on the development of applications in the metro network, long haul applications, data center interconnect, and others. Thus, the rising demand for energy-efficient and small-sized transceivers is driving the growth of the optical communication and networking market. Additionally, organizations are focusing on acquisitions and mergers to strengthen the presence in optical communication and networking equipment market. For instance, in March 2022, Huawei collaborated with ZainTech, a telecommunication operator to provide data services and to explore new cloud opportunities. The collaboration led to strengthen the existence of both the companies in the market.

Optical Communication and Networking Equipment Report Coverage:

Report Attributes	Report Details
Study Timeline	2017-2030
Market Size in 2030 (USD Billion)	31.90 billion
CAGR (2023-2030)	7.68 %
Base Year	2022
By Component	Optical Fiber, Switch, Transceiver, and Others
By Technology	SONET, WDM, and Fiber Channel
By End User	BFSI, IT & Telecom, Healthcare, Retail, and Others
By Geography	Asia-Pacific [China, Southeast Asia, India, Japan, Korea, Western Asia] Europe [Germany, UK, France, Italy, Russia, Spain, Netherlands, Turkey] North America [United States, Canada, Mexico] Middle East & Africa [GCC, North Africa, South Africa] South America [Brazil, Argentina, Columbia, Chile, Peru]
Key Players	Cisco System Inc., Nokia, Huawei Technologies Co. Ltd., ZTE Corporation, Ciena Corporation, ADVA Optical Networking, Infinera Corporation, FUJITSU, FiberHome, NEC Corporation, ADVA Optical Networking

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Market Dynamics:

Driver:

Rising demand of small sized energy efficient transceiver and increasing deployment of private 4G & 5G data networks is driving the growth of optical communication and networking equipment market.

Rising demand of small sized energy efficient transceiver and increasing deployment of private 4G & 5G data networks is driving the growth of optical communication and networking equipment market. The rising demand for small-sized energy-efficient transceivers is driven by the need for devices that operate on low power and provide high-speed connectivity. For instance, Broadcom and Fujitsu Optical Components are offering compact transceivers that consume less power. Thus, the increasing demand of compact and energy efficient transceiver is driving the growth of optical communication and networking equipment market.
Additionally, the optical communication supports the private data network for applications in various sectors including military, telecommunication, aerospace, and others. Thus, advancement in 4G and 5G technology has increased the deployment of private data network resulting in spurring the market growth.

Restraint:

Issue related to transmission losses is hampering the growth of optical communication and networking equipment market.

The optical beam attenuation or transmission losses occurs when the power level signals drop during data transmission from transmitter end to receiver end. The increasing turbulence in wind currents resulting to rise beam attenuation. Thus, the problem regarding transmission losses is hindering the growth of optical communication and networking equipment market.

Market Segmentation:



By Component

The component segment is categorized into Optical Fiber, Switch, Transceiver, and Others.
Transceiver segment holds a major market share for the optical communication and networking equipment market in the year 2022. The rising implementation of cloud computing and increased application of the internet is driving the growth of the transceiver segment in the optical communication and networking equipment market.
Furthermore, the transceiver segment is expected to witness a good growth rate during the forecast period due to rising usage of the internet for smartphones and other connected devices. Thus, the rising adoption of advanced technologies for IT deployment and increasing demand for data center is driving the growth of the transceiver segment in the optical communication and networking equipment market.

By Technology

The technology segment is divided into SONET, WDM, and Fiber Channel. WDM segment accounted largest revenue share for the optical communication and networking equipment market. The rising use of high-speed internet is driving the demand of Wavelength Division Multiplexing (WDM) technology in optical communication and networking equipment. Additionally, rising adoption of connected devices for residential and commercial applications is promoting the growth of WDM technology.
SONET technology is projected to grow during the forecast period due to rising adoption of Synchronous Optical Network (SONET) for the transmission of multiple data stream across fiber optic cable. Additionally, increasing demand for SONET technology for multiple digital data stream is driving the growth of SONET technology in the optical communication and networking equipment market.

By End User

The End User segment is classified into BFSI, IT & Telecom, Healthcare, Retail, and Others. BFSI segment accounted major market share in the year 2022 due to rising adoption of optical communication and networking equipment to protect customer\'s confidential data and to ensure data security. Additionally, the rising threat of data breaches is boosting the demand of optical networking resulting in the rise of BFSI segment in optical communication and networking equipment market.
Healthcare segment is expected to grow during the forecast period owing to rising adoption of advanced technologies including artificial intelligence and IoT for consultation, medical devices, diagnosis, and treatment. Rapid digitalization in healthcare industry is propelling the demand of secure network infrastructure resulting to rise the growth of healthcare sector in optical communication and networking equipment market.

By Region

The regional segment includes North America, Europe, Asia Pacific, the Middle East and Africa, and Latin America. North America accounted for major market share in the year 2022 due to increasing adoption of optical networking equipment. North America has large number of data centers resulting in increased demand for optical networking equipment. Additionally, existence of major market players in the region is further driving the growth of optical communication and networking equipment market.



Asia Pacific region is expected to grow during the forecast period due to technological advancements in developing countries including India and China. The dynamic development in 5G network propel the need of optical networking equipment in Asia Pacific region. Additionally, rising number of telecom subscribers are driving the growth of optical communication and networking equipment market in Asia Pacific region.

Optical Communication and Networking Equipment Market Competitive Landscape:

The competitive landscape of the market has been analyzed in the report, along with the detailed profiles of the major players operating in the industry. Further, the surge in Research and Development (R&D), product innovation, various business strategies, and application launches have accelerated the growth of the Global Optical Communication and Networking Equipment Market. Key players in the market include-

• Cisco System Inc.
• Nokia
• Huawei Technologies Co. Ltd.
• ZTE Corporation
• Ciena Corporation
• ADVA Optical Networking
• Infinera Corporation
• FUJITSU
• FiberHome
• NEC Corporation
• ADVA Optical Networking

Recent Developments:

• In February 2022, ZTE Corporation introduced series of new 5G products to build simplest and energy efficient 5G network services for easy operation of complex networks.

• In February 2022, ADVA Optical Networking introduced Ensemble Stimulator, a virtual network testing solution to allow the optical networking operators to monitor internetwork management and network growth.