Optical add/drop multiplexer consumption to reach $29.8 billion in 2010, reports ElectroniCast

March 5, 2001
Mar. 5, 2001--The global consumption value of Optical Add/Drop Multiplexers (OADMs), which will be an extremely important factor in the increase use of optical communications, will accelerate from $135.2 million in 2000 to $3.46 billion in 2005, then expand further to $29.8 billion by 2010.

The global consumption value of Optical Add/Drop Multiplexers (OADMs), which will be an extremely important factor in the increase use of optical communications, will accelerate from $135.2 million in 2000 to $3.46 billion in 2005, then expand further to $29.8 billion by 2010, according to a new global market forecast by the ElectroniCast Corporation.

The OADM is defined, for the ElectroniCast study, as a single-fiber unit; that is, one fiber in, one out. "The fiber, in essentially all situations, will transport wavelength division multiplexed (WDMd) signals, ranging 2-128 channels deployed in our base year 2000, and rising to 1024 wavelengths by the end of this forecast period, 2010," according to ElectroniCast Chairman and Founder Jeff D. Montgomery. "We recognize that the typical transport trunk cable contains many fibers; mainly in the range of 4-180 fibers; some recent cables with more fibers. However, some cables are shared by multiple carriers, each using a few fibers," Montgomery said.

Steady Advancement of OADM Capacity Over the 2000-2010 span, OADMs will advance from the currently available (Dense Wavelength Division Multiplexing/DWDM) 16 wavelength fixed-connection module to 256-wavelength fully reconfigurable units deployed and 1024-wavelength capacity reconfigurable systems introductory. "Without major advances in component technology, these targets would be unsupportable," according to ElectroniCast Research Analyst Catherine Rondeau.

To achieve design and test of 1024-wavelength fully reconfigurable OADMs for introduction and evaluation by 2010, the following components are needed, deliverable, by early 2005:

* 1024x(2x2) transparent optical crossconnect switches

* Laser diodes; precise wavelength for 50 GHz spacing; high power; in at least 20-diode bars, covering the nominal 1260-1660 nm band

* Optical fiber amplifier systems spanning the 1260-1660 nm band with uniform high gain and acceptable noise level.

"These performance gains must be achieved while maintaining high reliability and affordability. These targets are challenging, but achievable," Rondeau said.

"Rapid Growth of OADM Component Value," ElectroniCast's OADM study, also includes a separate forecast for the components that go into the OADM. OADMs incorporate a wide variety of optoelectronic and passive optical components. "As the capacity and complexity of OADMs expand greatly over the next decade, and as the deployment quantity rises, the related component value correspondingly climbs." Montgomery said.

Components include de-MUX filter modules, passive optical combiners, optical switches; and optical amplifiers, receivers and transponders where applicable. Components constitute about half of OADM value. (The balance is assembly/test labor, related sales/ administrative/overhead costs, and profit.) The global consumption of OADM components in 2000 is estimated at $68 million. This will rise rapidly, to $1.45 billion in 2005, as outlined in Figure 2. Strong growth will then continue, averaging 59 percent per year, to reach $14.67 billion by 2010. Components, in this report, are priced at estimated/forecasted market prices, whether purchased or produced internally.

About ElectroniCast:

Founded in 1981, ElectroniCast is a provider of forecasting for the fiber optic, optoelectronic and photonic industries. For more information, visit www.electronicast.com.

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