CIR: Transmission module market to net $ 13.4 billion by 2012

MAY 3, 2007 -- Today's network are becoming increasingly 'fiberized' with widespread deployment of 10 Gigabit Ethernet; traditional copper infrastructure is being abandoned in the data center, with Fibre Channel and parallel optics assuming a growing role; and PON architecture is at last bringing fiber to the home.

MAY 3, 2007 -- According to a new report from CIR (search for CIR), the transmission modules market will reach $ 13.4 billion by 2012, driven by several factors. First, the network is becoming increasingly 'fiberized' with widespread deployment of 10 Gigabit Ethernet (10-GbE). Second, traditional copper infrastructure is being abandoned in the data center, with Fibre Channel (at 4 Gbits/sec and above) and parallel optics assuming a growing role. Finally, PON architecture is at last bringing fiber to the home.

In the 10 GbE sector, replacing XENPAK, X2 and XPAK with XFP (including XFP-E) and SFP+ presents numerous opportunities, especially since the boundaries between these two emerging MSAs have yet to be defined. CIR believes that the market for SFP+ and XFP transceivers will reach $1.0 billion and $0.9 billion respectively by 2012.

Technological innovations are also creating new opportunities in the 10-GbE sector. Electronic dispersion compensation (search for EDC) has helped create an entirely new serial 10-GbE standard called LRM (search for LRM) with a broad range of applications. And 10GBASE-T capitalizes on new forms of copper cabling and signal processing to extend the reach of copper networks. 10GBASE-T alone should net up to $724 million in revenues in 2012.

Fibre Channel is very much in the ascendant with higher data rates (4 Gbits/sec and soon 8 Gbits/sec) at the start of its growth curve. There is also the possibility that Fibre Channel will break out from the SAN market and find applications in mainframe-to-mainframe interconnection and in grid computing. CIR expects that the total value for Fibre Channel modules in 2012 will amount to $747 million.

WDM is being spurred by growing bandwidth demands, the opportunity to eliminate costly OEO conversions, and the availability of more flexible bandwidth management in WDM equipment. In this sector, many of the opportunities have to do with tunability, a technique whose capabilities have yet to be fully explored, say CIR analysts. At the module level, this translates into demand for more tunable modules (especially pluggable ones) and the ability to bring cost points down to where tunables can be used more widely in metro (and perhaps even in access) networks. According to CIR, WDM modules should reach $2.2 billion by 2012.

CIR's new transmission modules report analyzes and quantifies the key market opportunities in the transceiver and transponder modules business through 2012. It covers Ethernet, Fibre Channel, parallel optics, PONs, SONET/SDH, and WDM and addresses the impact of new signal processing technology (including EDC), optical integration/silicon photonics, and other emerging technologies on the module market.


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