Optical Communication and Networking Equipment Market to Grow at 8% CAGR Between 2020-25

Posted Feb 13, 2020 by MarketsandMarkets

According to a new market research report published by MarketsandMarkets, the Optical Communication and Networking Equipment Market, valued at USD 18.9 billion in 2020, is projected to reach USD 27.8 billion by 2025; growing at a CAGR of 8.0% during the period. Rising adoption of cloud-based services and virtualization services all over the world, increasing data traffic due to increased internet usage, and growing number of data centers are the factors driving the optical communication and networking equipment market growth.

Based on Equipments, Optical Transceivers Market Expected to Grow at Highest CAGR

The demand for optical transceivers is expected to grow at the highest CAGR during the forecast period due to the introduction and adoption of new applications such as wearable devices, IoT, and cloud computing owing to the change in consumer needs. The increasing internet penetration and data traffic are leading to the rapid growth of data centers, along with the need for high transmission networks. Optical transceivers are used to upgrade telecommunications networks and launch very large mega data centers.

Based on Applications, Datacenter Applications to Grow at Highest CAGR

The market for data center applications is expected to grow at the highest CAGR during the forecast period. The growth of this market can be attributed to the increasing adoption of cloud computing as a mainstream deployment option and growing demand for high-speed internet by the users of smartphones and other connected devices. There is a rapid increase in internet traffic in mega data centers too. Mega data centers are operated primarily by leading companies, such as Amazon (US), Apple (US), Facebook (US), Google (US), and Microsoft (US).

Based on Regions, Americas to Hold Largest Share

The Americas accounted for a major share of the overall optical communication and networking equipment market in 2019. The Americas region has emerged as a major data center, and cloud computing hub, which has ultimately made the region the largest consumer of optical communication and networking equipment as the data center is the leading application of this market. Factors such as the robust presence of major companies in the region; high demand for data communication; increased use of communication devices, such as smartphones, tablets, and VoIP equipment; as well as the growing market for wearable devices and increasing deployment of data centers drive the growth of the optical communication and networking equipment industry in this region.

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