LONDON, ENGLAND: The global optical components (OC) market posted revenues of $6.8 billion in 2013, up 3 percent from the 2012 level.
The gain was due to strong datacom sales driven by hyperscale data centers, 100G coherent demand, and unexpected growth in sales of transceivers for fiber-to-the-antenna applications for 4G build-outs, according to global market research firm Ovum.
Ovum’s new optical components forecast* projects the following market developments:
* OC sales will grow in 2014 following a respectable 1Q14. The market posted a 1 percent decline sequentially, but grew 7 percent compared to the year-ago period. The lower 1Q14 result is due to new lower telecom prices being implemented. Demand for 100G components for coherent transmission in WAN, datacom transceivers at 10 and 40G, and fiber-to-the-antenna transceivers is expected to continue. Traffic continues to increase, and high-speed optics being used in new applications are helping to drive the market forward.
* 1Q14 marks the fourth consecutive quarter with revenue growth compared to the year-ago period. The market is moving along at a nice pace when compared to the year-ago period.
* The WAN OC segment, which includes components in telecom carriers’ core and metro networks, continues to be the largest segment and is forecasted to grow at a CAGR of 11 percent to $7 billion in 2019. Demand for 100G components and modules is a big driver for growth in WAN. We expect strong demand for pluggable coherent transceivers in 2015.
* ROADMs and amplifiers posted a weak 2013, and we expect this weakness to continue in 2014. However, we do believe that the market will start to ship the colourless, directionless and contentionless ROADMs with flexible grid in 2015 and grow from there. We also expect growth from sales of Raman amplifiers, particularly at the end of the forecast period, to support longer-distance transmission for data rates beyond 100G.
* Datacom will be the fastest-growing segment, expanding at a 16 percent CAGR to reach $4.2 billion in 2019. The market is led by demand for 10 and 40G components in the early years and then 100G in the later years driven by the availability of server ports supporting data rates greater than 10G.
* Access is forecasted to decline at a 2 percent CAGR to $1.1 billion in 2019. Access includes CATV, FTTx and transceivers for the fiber-to-the-antenna application. The decline will be driven by the FTTx application, where volumes are nearly constant through the forecast period but price declines are projected to pull down revenues.