Fiber-optic components market surges, fueled by all-optical network emergence

Sept. 1, 1999

Already at its highest level in history, according to Communications Industry Researchers Inc. (CIR--Charlottesville, VA), the North American fiber-optic components market will reach $6.1 billion by 2003, up from $2.8 billion in 1999. CIR's new report, The Market for Optical Components: A Ten-Year Forecast, is based on a survey of optical components manufacturers, including those in the laser, detector, wavelength-division multiplexing (WDM), amplifier, and optical-switch segments.

Although the entire market is expected to grow by 18.5% annually, CIR cites areas of special opportunity. The fastest- growing segment over the next four years will be the optical-switching components market, which is expected to grow at a staggering 67%. The report says that while the all-optical network will not be entirely commercialized for more than a decade, optical switching will begin to become mainstream in the next few years. Major carriers are already deploying optical crossconnects.

Another area of opportunity will be in the WDM components market, which will reach $318 million by 2003. Not all segments of the optical components market will be quite as exciting, how ever. For example, the market for light-emitting diodes will grow at only 8.5% over the next four years, reflecting the emergence of low-cost laser products.

The report is also optimistic about the entry of innovative new companies in the optical components market, citing that new opportunities are appearing for innovators in the laser, WDM, optical switching, and fiber segments of the market. The report stresses that service providers are now seriously looking into fiber-to-the-curb and fiber-to-the-home applications, while some major end users are considering fiber-to-the-desk. CIR believes that the fiber-optic component vendors who position themselves now for the coming enormous market for low-cost optical components will likely be more successful.

The study notes there is a constant push and pull for the vendor between integrating better technology and keeping the price points low. The vendor that can strike this balance best, says CIR, will win the day.

In addition to providing in-depth analysis of the economic and technological trends in the optical component market, the study includes a 10-year forecast of revenues from all the important market segments. It also provides profiles and strategic appraisals of the activities and products of leading vendors. Startup companies and innovators are also profiled.

The report is available for $4000 by calling CIR's Robert Nolan at (617) 923-7611 or e-mail: [email protected].

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