Passive optical network equipment is used for fiber to the home (FTTH), fiber to the building (FTTB), and fiber to the curb (FTTC) networks. Some key products associated with passive optical network equipment include optical line terminals (OLTs), optical network terminals (ONTs), and optical splitters. OLTs act as a control unit and ONTs convert the optical signal received by the ONT into an electrical signal to be used by subscriber devices. Optical splitters are used to divide an optical input signal into multiple output signals using passive light-splitting technology. Passive optical network equipment is central to fiber deployments that provide high-speed broadband access and connectivity to users.
The global passive optical network equipment market is estimated to be valued at US$ 22.92 Mn in 2023 and is expected to exhibit a CAGR of 22% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
One of the key drivers for the growth of the passive optical network equipment market is the rising number of smart city projects across the globe. Smart cities utilize fiber broadband networks with FTTH connectivity to provide high-speed internet access to citizens. This allows implementation of smart mobility solutions, energy management systems, public safety features, and healthcare access through telemedicine. Various government initiatives are supporting the development of smart cities which is expected to drive the demand for passive optical network equipment for fiber deployments. Another driver is the increasing investments by telecom operators to upgrade their copper broadband infrastructure to fiber. Fiber networks can support internet speeds over 1 Gbps compared to copper networks. This is prompting telecom companies to adopt PON architectures for broadband access over optical fiber to meet rising consumer demand for high bandwidth applications and online content.
Segment Analysis
The passive optical network equipment market is dominanted by the FTTx segment. FTTx stands for Fiber To The x segment and it refers to fiber optic communication delivered to the end user premises, such as apartments or businesses. Within FTTx, fiber to the home (FTTH) has emerged as the most important sub-segment as it provides the highest bandwidth capability and two-way communication compared to other FTTx architectures. FTTH is dominating the market as connectivity at higher speeds is being increasingly demanded by consumers for applications such as video streaming, high speed internet browsing, and online gaming. Advancements in 5G infrastructure are also fueling the growth of FTTH.
PEST Analysis
Political: Governments across regions are supporting investments in digital infrastructure to improve internet connectivity. They are offering subsidies and tax incentives for telecom operators and organizations deploying fiber networks.
Economic: Developing economies are witnessing increasing deployment of FTTH to support rapid industrialization and development of smart cities. Rise of remote working and online education during the pandemic has highlighted the need for high speed connectivity.
Social: Younger demographics are early adopters of new technologies and demand high bandwidth for applications like social media, video calling, and online multiplayer gaming. This is driving the need for fiber networks till consumer premises.
Technological: Equipment manufacturers are developing next-generation PON technologies like XGS-PON and NG-PON2 that offer throughput of 10Gbps and beyond. These enable telecom operators to deliver premium broadband and cloud services to both residential and business customers.
Key Takeaways
The Global Passive Optical Network Equipment Market Size is projected to reach US$ 22.92 Mn by 2023. The global passive optical network equipment market is estimated to be valued at US$ 22.92 Mn in 2023 and is expected to exhibit a CAGR of 22% over the forecast period 2023 to 2030.
Regional analysis
The Asia Pacific region dominates the passive optical network equipment market led by China, Japan and India. China has emerged as the global leader in FTTH deployments driven by strong government support for digital infrastructure projects. Many cities in China now have fiber coverage of over 90%. Southeast Asian countries of Malaysia, Thailand and Vietnam are also witnessing high subscriber growth in FTTH.
Key players
Key players operating in the passive optical network equipment market are Adtran Inc., Huawei Technologies Co. Ltd., Alcatel-Lucent S.A., Hitachi Communication Technologies, Inc., AT & T Inc., Freescale Semiconductor, Inc., Broadcom Corporation, Inc., Ericsson Inc., Calix Inc., and ECI Telecom, Ltd. Adtran and Huawei have established a significant global presence through continuous R&D investments and new product launches
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
