Growth of 160% in 10-Gbps optical transceivers and increasing shipments of 40-Gbps optical modules helped the market for 10-Gbps, 40-Gbps, and 100-Gbps optical transceivers reach $1.2 billion in revenues in 2010, according market research firm Infonetics Research. That figure will grow to $2.8 billion, Infonetics predicts in its new 10G/40G/100G Optical Transceivers Market Size and Forecast report.
The 2010 revenue figure represents a significant increase over the $865 million sales of such modules garnered in 2009. Overall the outlook in this space appears to have become more optimistic; last year Infonetics predicted the 10G/40G/100G optical transceiver market would reach $1.44 billion by 2014 (see "Infonetics: SFP+, tunable XFPs to drive 10G/40G/100G transceiver market to $1.44B by 2014").
"For dominant vendors with good cost controls and broad product lines, the 10G transceiver market is a good place to be, a sharp contrast to the reality of the previous 10 years,” comments Andrew Schmitt, directing analyst for optical at Infonetics Research and author of the report.
For example, the report states that 10-Gbps WDM module shipments more than doubled in 2010 versus 2009, while 10-Gbps SFP+ module shipments tripled in 2010 on the strength of 10-Gigabit Ethernet (10GbE) and 8G Fibre Channel demand. However, Infonetics expects 10-Gbps WDM growth 2011 to be more in-line with the growth in end-equipment. More tellingly, Schmitt and Infonetics say 10G growth will slow as the market shifts to more compact form factors with less electronics (SFP+ and XFP modules) and lower average selling prices.
Meanwhile, Infonetics calls 2013 the year when 100 Gbps finally takes off. Price points will be reached by 2013 that will drive widespread adoption; for example, 100GBase-LR4 pricing is expected to rapidly drop as multiple component vendors enter the market.
Until then, 40G/100G interface vendors will face tough sledding. “Unfortunately for some component suppliers, NEMs are supplying an increasing share of 40G and 100G long reach ports, leaving optical module manufacturers to fight for a diminishing share of this accelerating market,” Schmitt explains (see accompanying chart). “There will be minimal market for many suppliers of 40/100G transponders, until the NEMs [network equipment manufacturers] decide to outsource supply, most likely not until 2013 or later."
The 10G/40G/100G Optical Transceivers Market Size and Forecast report. tracks transceivers and transponders sold into the optical transport, enterprise, and carrier routing and switching markets. Infonetics asserts it is the first such report to use end-market projections of carrier preferences and equipment shipments to drive component forecasts, including shipments of 40G and 100G ports designed and manufactured in-house by NEMs such as Ciena and Huawei.
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