Optical interconnect market to record USD 9.66 bn growth

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The potential growth difference for the optical interconnect market between 2021 and 2026 is USD 9.66 billion, as per the latest market analysis report by Technavio. The report predicts the market to witness a decelerating growth momentum at a CAGR of 13.67%. Technavio categorizes the global optical interconnect market as a part of the global technology hardware, storage, and peripherals market. Our report provides extensive information on the value chain analysis for the optical interconnect market, which vendors can leverage to gain a competitive advantage during the forecast period. The data available in our value chain analysis segment can help vendors drive costs and enhance customer services during the forecast period.

Key market dynamics:

• Market Driver: One of the key factors driving the global optical interconnect industry growth is the adoption of cloud databases. Commercial enterprises require very high storage capacity and need to access information and data from any location. Many enterprises use cloud-based storage services such as AWS, Amazon Cloud Drive, Bit Torrent Sync, Box, Cubby, Dropbox, and Google Drive. The cloud-based services such as PaaS and SaaS have created a huge demand for fiber optical interconnects. As the global spending by enterprises on cloud storage increases, it will also boost the demand for fiber optical interconnect for cloud-based applications in the forecast years.
• Market Challenge: One of the key challenges to the global optical interconnect industry growth is the high cost of optical interconnectors. The average selling price of an interconnector ranges from $100 to $600 depending on the number of applications, the package weight, bandwidth, split ratios available, custom wavelength, coupling ratio, sample rate, and several channels. The high ASP of the interconnector may limit tits demand in the forecast years.

Key market segmentation insights:
This report extensively covers optical interconnect market segmentation by fiber type (single-mode fiber and multimode fiber), connectivity (rack level, long-haul level, and chip and board level), product type (optical transceivers, connectors, cable assemblies, and others), and geography (APAC, North America, Europe, South America, and Middle East and Africa).

Revenue-generating Segment Insights: The optical interconnect market share growth by the single-mode optical fibers segment will be significant during the forecast period. The growth can be attributed to specialized applications such as illumination, imaging, medical cases, and telemetry. In addition, short-distance data centers used by government agencies and enterprises use single-mode fiber-optic interconnects.

Regional Opportunities: 63% of the market’s growth will originate from APAC during the forecast period. China, South Korea, and Japan are the key markets for optical interconnect in APAC. Market growth in this region will be faster than the growth of the market in North America, Europe, and MEA. The increase in interest of Indian and Chinese governments in deploying fiber optics for communication, a growing number of telecom subscribers in APAC, and rising demand for data centers will facilitate the optical interconnect market growth in APAC over the forecast period. BCS Bureau