China, data centers to support optical module growth for next five years

LightCounting has issued a new optical communications market forecast report in which it predicts optical module and component sales will increase at a compound annual growth rate (CAGR) of 10% from 2017 to 2021. Consumption of optical transceivers and components across China and within the global data center market will drive most of this growth, the market research firm predicts.

This CAGR is smaller than LightCounting’s prediction for this year. The company believes sales of optical components and modules in 2016 will increase by 17% versus 2015. This year’s predicted growth figure also is slightly smaller than previous LightCounting estimates.

Nevertheless, deployment of 100-Gbps DWDM networks and China and 40 Gigabit Ethernet and 100 Gigabit Ethernet (100GbE) within webscale data center networks will provide the engine for this year’s spike as well as for continuing success over the forecast period.

“The increasing contribution of China to the global market was related to its massive deployments of FTTx and wireless fronthaul optics in 2011-2015, but the situation has changed in 2016,” explains Dr. Vladimir Kozlov, CEO and founder of LightCounting Market Research. “This year it is demand for 100G DWDM and 100GbE optics that increased China’s share of the global market, and we think this trend will continue in 2017-2021.

Overall, LightCounting expects sales of optical products to the cloud data center market will increase by 20% per year on average during the new report’s forecast period.

The Market Forecast report forecasts demand through 2021 for optical components and modules used in Ethernet, Fibre Channel, SONET/SDH, CWDM/DWDM, wireless infrastructure, FTTx, and high-performance computing (HPC) applications.