Co-Packaged Optics Markets 2022-2029

Co-Packaged Optics Market Will Reach Almost $2.3 Billion by the End of the Decade

Co-Packaged Optics Revenues to Reach $5.4 Billion by 2027

The report focuses on the demand for CPO within data centers and says that CPO deployment will be largely driven by switching evolution, which will reach speeds of 102.4 Tbps in 2025.  Once switching reaches this level, pluggable transceivers will fade away. CPO promises to reduce the power consumption by 30 percent and the cost-per-bit by 40 percent compared to using pluggable optics.

About the Report

In 2021, the analyst produced a widely read report pointing out the advantages, disadvantages, and future applications for CPO. Much has changed since then as in 2022 optoelectronics firms have settled down to producing real-world products including a new early-stage and now available version of CPO (called NPO).  Meanwhile, the OIF has taken on the role of providing a framework for future CPO products.

This report brings the CPO story up to date and points out the growing opportunities in how CPO will be used in four kinds of data centers:  Hyperscale, Enterprise, Telephone Company, and Edge. In addition to the CPO modules themselves, this report examines the latest developments in lasers and cooling systems for CPO as well as analyzing the competition between CPO and next-generation pluggable transceivers.

The report forecasts CPO modules from 2022 to 2030 with breakouts by type of data center and location (inter-building/inter-machine or rack/server) in the data center.  Forecasts are provided both in terms of volume shipments and revenues.  These forecasts are based on an analysis of the user adoption patterns for high-speed interfaces in data centers.

In addition, this report has a strong emphasis on CPO’s impact on the optoelectronic supply chain in the wake of both technological change and geopolitical developments. Key companies discussed include AMD, Anritsu, Ayar Labs, Broadcom, Furukawa Electric, GlobalFoundries, IBM, Marvell, Lumentum, Ranovus, SENKO, TE Connectivity, Xlinx and others.

From the Report

• CPO-based gear will initially be used in hyperscale data centers, which will account for 80 percent of CPO revenues in 2023. Hyperscalers have been driving the CPO “movement” for some years.  However, the analyst expects CPO to move into other kinds of data centers in a year or so.
• The ultimate driver for CPO in the data center can be found in new kinds of high data-rate traffic with exceptionally low-latency requirements. This new data center traffic - notably AI and machine learning (ML) - will be the main CPO market drivers. Other kinds of traffic that will help increase demand for CPO are augmented reality (AR) and virtual reality (VR)
• The emergence of Near-packaged optics (NPO), which has many of the advantages of CPO but is simpler to implement. NPO means that data equipment vendors and HPC firms can shift to 800G now without getting bogged down in the complexities of CPO. NPO is now an effective on-ramp for CPO and presents a viable alternative to pluggables that previously did not exist.

Who should read this report?

Whether you are an optical component manufacturer, optical equipment manufacturer, large end-user, or investor, you will gain valuable insights from this in-depth research.