Opto-electronic and photonic component markets poised for rapid growth

Opto-electronic and photonic component markets poised for rapid growth

The use of opto-electronic devices for ATM premises networks is predicted to increase approximately 135% through 1998

This report was written by Assistant Editor Marcy Koff from information provided by Electronicast Corp., San Mateo, CA.

During the past decade, advancements in fiber-optic component technology have been evolutionary. However, components (opto-electronics, fiber, connectors and splitters) have changed little in capability, performance and cost. But dramatic changes, especially for photonic components, are predicted for the next few years.

According to Electronicast Corp., a marketing consultancy based in San Mateo, CA, the North American consumption value of opto-electronic components in local area networks is expected to increase approximately 34% per year during the next few years, to $649.5 million in 1998. From 1998 to 2003, the consumption value should continue to rise at an average annual growth rate of 30% and is expected to reach $2.42 billion by 2003.

Conventional data communications networks, including proprietary interconnects, accounted for 79% of opto-electronics value in 1993, or $119.7 million. Jeff D. Montgomery, chairman at Electronicast Corp., says the conventional data communications share should decline to 33%--or $217.4 million--by 1998 and then slip to 24%--or $585 million--by 2003.

FDDI dominates

He says fiber distributed data interface is the dominant new network topology, with opto-electronics component value growing approximately 48% per year to reach $218.9 million by 1998. He adds, "Beyond 1998, however, FDDI will level off, and the growth will be dominated by asynchronous transfer mode, Fibre Channel and Fast Ethernet. The rapid growth in later years will be driven by accelerating deployment of fiber to the desktop and in distributed computing."

Through 2003, the upgrade market should also represent a significant share of the total market. Electronicast forecasts a continuing demand for upgrading networks to accommodate rapidly increasing bandwidth requirements. ATM switches, hubs, concentrators and other electronic equipment are being shipped with empty slots in the interface rack, enabling systems operators to:

Add input/output boards to fill vacant slots

Remove initial low data rate electronic boards, such as T1 or T3

Substitute higher data rate opto-electronic boards.

Although FDDI is expected to experience major growth through 1998, the use of opto-electronic components for ATM premises networks is expected to skyrocket during the same period. From 1993 to 1998, the average annual growth rate is predicted to be 134.5%--from $0.60 million in 1993 to $42.81 million in 1998. The average annual growth rate from 1998 to 2003 is forecasted to be 70.6%. In 2003, the sales of these ATM network components should be approximately $619.4 million.

Just as the opto-electronic component market is expected to increase considerably, the climate for the introduction of new photonic components is more favorable than it was 10 years ago because of expanding demand for continental and global bandwidth.

Significant fiber-optic component technologies that will support this bandwidth surge include:

Photonic throughput switch matrices

Surface-emitting vertical cavity quantum-well laser-diode arrays

Optical waveguides in substrate, for intra-enclosure/backplane links

Network interface devices engineered for low-cost, high-volume production.

Singlemode photonic throughput matrices should contribute to disaster recovery and continuous fiber-optic network monitoring, and multimode versions are expected to be increasingly used in business and military data communications networks. Other photonic switching technologies, such as nonlinear optical polymeric film, are being rapidly developed.

Laser-diode arrays will support massively parallel (such as 96-channel) bidirectional links for workstation clusters and ganged supercomputers. This technology will be applied to interconnect ATM crossconnect switches, computers and other equipment, and devices should be in production within five years.

Optical waveguide in substrate is now in production as fiber embedded in a flexible film. This waveguide is also being processed photolithographically in passive polymeric film.

Another recently developed photonic component is an integrated fiber-optic network interface device that can be produced in high volume at less than $100 per unit. This photonic device will be mounted on residential walls or in set-top converters.

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