Optical Communication and Networking Global Market Opportunities and Strategies to 2032

This report describes and explains the optical communication and networking market and covers 2017 to 2022, termed the historic period, and 2022 to 2027 termed the forecast period, along with further forecasts for the period 2027-2032. The report evaluates the market across each region and for the major economies within each region.

The global optical communication and networking market reached a value of nearly $22,100.46 million in 2022, having increased at a compound annual growth rate (CAGR) of 7.00 % since 2017. The market is expected to grow from $22,100.46 million in 2022 to $29,508.99 million in 2027 at a rate of 5.95%. The market is then expected to grow at a CAGR of 8.81% from 2027 and reach $45,007.03 million in 2032.

Growth in the historic period resulted from increasing demand for energy-efficient & compact transceivers, tech sector supported the demand for optical communication, increasing number of internet users, strong economic growth in emerging markets and increasing wireless technology. Factors that negatively affected growth in the historic period was political uncertainties and geopolitical tensions and susceptibility to hacking.

Going forward, increasing number of data centers, rising urbanization, government initiatives and increasing internet penetration will drive the market. Factors that could hinder the growth of the optical communication and networking market in the future include shortage of skilled professionals and high initial deployment cost.

The optical communication and networking market is segmented by component into optical fiber, optical transceiver, optical switch, optical amplifier, optical circulator and other components. The optical fiber was the largest segment of the optical communication and networking market by component, accounting for $5,984.39 million or 27.08% of the total market in 2022. It is expected to be the fastest-growing segment going forward at a CAGR of 6.33%.

The optical communication and networking market is segmented by technology into wavelength division multiplexing (WDM), synchronous optical network (SONET) and fiber channel. The wavelength division multiplexing (WDM) market was the largest segment of the optical communication and networking market by technology, accounting for $10,480.60 million or 47.42% of the total market in 2022. It is expected to be the fastest-growing segment going forward at a CAGR of 6.17%.

The optical communication and networking market is segmented by end user into IT and telecom, banking, financial services, and insurance (BFSI), aerospace and defense, healthcare, energy and utilities and other end users. The IT and telecom was the largest segment of the optical communication and networking market by end user, accounting for $6,662.96 million or 30.15% of the total market in 2022. It is expected to be the fastest-growing segment going forward at a CAGR of 6.28%.

Asia Pacific was the largest region in the optical communication and networking market, accounting for 33.23% of the global market in 2022. It was followed by North America, Western Europe and the other regions. Going forward, the fastest growing regions in the optical communication and networking market will be Asia Pacific and the North America, where growth will be at CAGRs of 6.86% and 6.36% respectively from 2022-2027.

The global optical communication and networking market is concentrated, with a large number of players. The top ten competitors in the market made up to 55.1% of the total market in 2021. Huawei Technologies Co Ltd was the largest competitor with 9.16% share of the market, followed by Cisco Systems Inc with 7.77%, Fujitsu Group with 6.75%, II-VI Incorporated with 6.40%, Nokia with 5.95%, Broadcom Inc with 5.01%, ZTE with 3.95%, Ciena with 3.77%, Juniper Networks Linc with 3.49%, and Ericsson with 2.85%.

The top growth potential in the optical communication and networking market by component will arise in the optical fiber market, which will gain $2,150.84 million of global annual sales by 2027. The top growth potential in the optical communication and networking market by technology will arise in the wavelength division multiplexing (WDM) market, which will gain $3,654.39 million of global annual sales by 2027. The top growth potential in the optical communication and networking market by end user will arise in IT & telecom market, which will gain $2,372.91 million of global annual sales by 2027. The optical communication and networking market size will gain the most in the USA at $2,073.28 million.

Market-trend-based strategies for the optical communication and networking market include use of multicore optical fiber, adoption of coherent optics, use of fiber optic cables, new product launches, technological advancements, mergers and acquisitions and partnerships and collaborations.

Player-adopted strategies in the optical communication and networking industry includes strengthening business operations through the launch of new products and solutions, enhancing business activities through strategic acquisitions, empowering high-speed networks through the launch of new products and solutions, meeting the rising demand for unified optical monitoring solutions through the launch of new solutions and expanding business capabilities through new contract wins.

To take advantage of the opportunities, the publisher recommends the optical communication and networking companies to focus on multicore optical fiber, focus on coherent optics, focus on new product launches, focus on technological advancement, expand in emerging markets, continue to focus on developed markets, focus on partnerships and collaborations, continue to use b2b promotions, participate in trade shows and events, continue to target fast-growing end-users, target governments.