Free Space Photonics Equipment Global Market Report 2025

The free space photonics equipment market size has grown rapidly in recent years. It will grow from $1.11 billion in 2024 to $1.26 billion in 2025 at a compound annual growth rate (CAGR) of 13.4%. The growth in the historic period can be attributed to growing adoption of high-speed wireless communication technologies, increasing defense and military communication applications, expansion of smart city infrastructure projects, rising adoption of lidar in automotive and aerospace industries, and growing investments in space exploration and satellite communication.

The free space photonics equipment market size is expected to see rapid growth in the next few years. It will grow to $2.07 billion in 2029 at a compound annual growth rate (CAGR) of 13.1%. The growth in the forecast period can be attributed to increasing deployment of free-space optical communication in 5G and beyond networks, rising demand for secure and low-latency data transmission, expansion of satellite internet services, growing integration with quantum communication technologies, and increasing adoption in autonomous vehicle systems and smart infrastructure. Major trends in the forecast period include development of hybrid free-space and fiber-optic networks, advances in adaptive optics for atmospheric turbulence mitigation, integration with AI for optimized beam steering, growth in space-based photonics applications, and increasing miniaturization of photonics components for portable solutions.

The rising adoption of 5G networks is expected to propel the growth of the free space photonics equipment market going forward. 5G networks represent the latest generation of wireless technology designed to provide faster data speeds, minimal communication delays, and the capacity to connect a large number of devices simultaneously. The growth of 5G networks is driven by increasing demand for high-speed and low-latency connectivity, enabling advanced technologies such as autonomous vehicles, smart cities, and real-time remote healthcare to operate effectively. This demand for ultra-fast, high-capacity data transmission and dense small-cell connections fuels the need for free-space photonics equipment, which provides efficient, high-bandwidth optical wireless links for backhaul. For example, according to a March 2022 report by the GSM Association, a UK-based non-profit organization, 5G connections surpassed 1 billion in 2021 and are projected to double to 2 billion by 2025. By the end of 2025, 5G connections are expected to make up over 20% of total mobile connections, with more than 40% of the global population having access to 5G networks. Consequently, the rising adoption of 5G networks is driving the growth of the free space photonics equipment market.

Companies in the free space photonics equipment market are focusing on developing advanced adaptive optics systems to improve the performance and reliability of free-space optical communication links by dynamically correcting atmospheric distortions. Adaptive optics systems use sensors and deformable optics to detect and compensate for atmospheric turbulence in real time, enhancing beam quality, data throughput, and link stability over long distances. For instance, in April 2023, Viasat Inc., a US-based communications company, launched the Mercury Expeditionary Free Space Optical Communications (FSOC) Terminal. This terminal integrates an automated pointing, acquisition, and tracking (PAT) gimbal system, enabling rapid setup and precise beam alignment. It provides ultra-high throughput of up to 40 Gbps over line-of-sight distances up to 70 km while maintaining a low electromagnetic footprint. The system is designed to resist jamming, spoofing, and atmospheric interference, ensuring connectivity in contested environments. It supports expeditionary and tactical missions, delivering fiber-like secure performance for ground-to-ground, ground-to-air, ship-to-ship, and ship-to-shore communications.

In August 2025, ReOrbit, a Finland-based space systems and satellite software technology company, partnered with Mynaric to integrate advanced optical terminals into next-generation satellite platforms. This partnership aims to equip ReOrbit’s software-defined satellites with Mynaric’s Condor Mk3 optical communication terminals, enabling high-throughput, quantum-resilient space-to-space and space-to-ground data links. These links will support secure, scalable, and interoperable satellite networks for commercial and defense missions. Mynaric is a Germany-based technology company specializing in laser communication terminals for aerospace and satellite connectivity.

Major players in the free space photonics equipment market are Broadcom Inc., Fujitsu Limited, L3Harris Technologies Inc., Corning Incorporated, Mynaric AG, Acuity Brands Inc., Trimble Inc., Lumentum Holdings Inc., Applied Optoelectronics Inc., EC SYSTEM, pureLiFi Limited, AOptix Technologies Inc., Mostcom Inc., BridgeComm Inc., Oledcomm, Finisar Corporation, KORUZA, LightPointe Communications Inc., FSONA Networks Corporation, and Wireless Excellence Limited.

North America was the largest region in the free space photonics equipment market in 2024. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in free space photonics equipment report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East and Africa.

Note that the outlook for this market is being affected by rapid changes in trade relations and tariffs globally. The report will be updated prior to delivery to reflect the latest status, including revised forecasts and quantified impact analysis. The report’s Recommendations and Conclusions sections will be updated to give strategies for entities dealing with the fast-moving international environment.

The rapid rise in U.S. tariffs and the subsequent trade frictions in spring 2025 are having a major impact on the electrical and electronics sector, with semiconductors, display panels, and rare-earth metals (essential for batteries and motors) subject to steep duties. Consumer electronics brands face profit erosion, as competitive markets limit their ability to pass costs to buyers. Industrial electronics manufacturers, meanwhile, grapple with delayed projects due to shortages of tariff-impacted components like printed circuit boards. Companies are responding by relocating assembly to tariff-exempt countries, increasing inventory buffers, and redesigning products to reduce dependency on restricted materials.

The free space photonics equipment market research report is one of a series of new reports that provides free space photonics equipment market statistics, including free space photonics equipment industry global market size, regional shares, competitors with a free space photonics equipment market share, detailed free space photonics equipment market segments, market trends and opportunities, and any further data you may need to thrive in the free space photonics equipment industry. This free space photonics equipment market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

Free-space photonics equipment refers to devices and systems that transmit, receive, or process information using light through open air or vacuum rather than optical fibers or other guided media. This technology enables high-speed, secure, long-distance optical communication, as well as precise sensing and advanced imaging applications, without relying on physical cables.

The primary types of free-space photonics equipment include transmitters, receivers, optical amplifiers, modulators, filters, and switches. Transmitters generate and launch tightly collimated optical beams (visible or infrared) across air or space. These systems use various technologies, including free-space laser communication, fiber optic solutions, optical wireless technology, advanced modulation techniques, and quantum key distribution, and are applied in sectors such as corporate networks, education, energy, utilities, and industrial operations. End-users include telecommunications operators, aerospace and defense contractors, healthcare providers, automotive manufacturers, and others.

The countries covered in the free space photonics equipment market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The free space photonics equipment market consists of revenues earned by entities by providing services such as system design, installation, calibration, testing and validation, maintenance, and consulting. The market value includes the value of related goods sold by the service provider or included within the service offering. The free space photonics equipment market also includes sales of beam expanders, beam splitters, collimators, lenses, and mirrors. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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