Worldwide Photonic Integrated Circuit Industry to 2026 - Data Centers by Application to Drive the Market Growth - ResearchAndMarkets.com

The "Global Photonic Integrated Circuit Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)" report has been added to ResearchAndMarkets.com's offering.

The global photonic IC market was valued at USD 5790.6 million in 2020, and it is projected to be worth USD 21649.8 million by 2026, registering a CAGR of 22.4% during the forecast period of 2021-2026.

Companies Mentioned

• Neophotonics corporation
• Poet Technologies
• II-VI Incorporated
• Infinera Corporation
• Intel Corporation
• Cisco Systems Inc.
• Source Photonics Inc.
• Lumentum Holdings
• Caliopa
• Effect Photonics
• Colorchip Ltd

Key Market Trends

Data Centers by Application to Drive the Market Growth

The Internet of Things (IoT), cloud, streaming video, 5G, and many other trends are forcing data centers to scale exponentially. According to the Cisco Global Cloud Index, annual data center internet protocol traffic is expected to surpass 20 Zettabytes (or 20x1021 bytes) by 2021. In the data centers, optical links connect the server racks through a complex network of fiber optical cables. Currently, 100 Gb/s optical links that are made up of 4x25 Gb/s single channels or lanes are sustaining data traffic within the data center. These links transmit data over lengths of fiber stretching from a few meters up to 2km, with single-mode fiber the optical medium of choice for spanning large distances.

More likely, over the next few years, data centers operators are expected to upgrade their networks to 400 Gb/s optical links (by aggregating 4x100 Gb/s lanes per link) as a step to meet the enormous demand for data. As the number of optical links within data centers will grow exponentially, these links need to be low-cost and consume as little power a/s possible, which is expected to drive the photonic IC market.

However, Silicon nanophotonic technology is already in system-to-system connection in data centers. In the future, the technology will move into the connections between chips within servers and eventually between sections on the chips themselves. This evolution is a response to the difficulty of moving electrons at higher and higher speeds over shorter and shorter distances. In March 2021, Teramount, a provider of connectivity solutions for ultra-high bandwidth applications, announced that it had completed a USD 8 million funding round. This investment will help in their photonic-plug technology, which will open the door to the next-generation tech set to fulfill the promise of silicon photonics in data centers, mobility 5G, and beyond.

North America to Hold a Major Market Share

In North America, the demand for photonic integrated circuits (PIC) based products is driven by data centers and WAN applications of fiber optic communication. The growing need for high-speed data transmission increased the data traffic in cloud computing, and the rapid roll-out of IoT has created a potentially booming photonic integrated circuit industry in the region. According to Cisco Cloud Index, North America is expected to generate the most cloud traffic (7.7 ZB per year) by the end of 2021. Such trends are expected to increase market adoption.

Service providers are facing increasing demand for bandwidth, much of which is being driven by mobile, video, and cloud-based services. Companies are expected to base their optical networks on the PIC, which is likely to contribute to the market's growth positively. Multinational companies, such as IBM Corporation, Intel Corporation, and Cisco, in the region, are working hand in hand with partners in academia, business, and the government, to develop PIC-based solutions for communications challenges.

For smaller enterprises, public-private partnerships have forged national research consortiums, such as American Institute for Manufacturing Integrated Photonics (AIM Photonics, Rochester, NY) in the United States, Canadian Photonic Industry Consortium, Florida Photonics Cluster, and Ontario Photonics Industry Network.

The Defense Advanced Research Projects Agency (DARPA) recently issued a solicitation for the Atomic-Photonic Integration (A-PhI) project to reduce the complexity of trapped-atom high-performance PNT devices. The researchers envision photonic integrated circuits replacing the optical assembly behind atomic physics devices while enabling the necessary trapping, manipulation, cooling, and interrogation of atoms. This is predicted to increase the adoption of PIC technology developments over the forecast period.

Key Topics Covered:

1 INTRODUCTION

1.1 Study Assumptions and Market Definition

1.2 Scope of the Study

2 RESEARCH METHODOLOGY

3 EXECUTIVE SUMMARY

4 MARKET INSIGHTS

4.1 Market Overview

4.2 Industry Attractiveness - Porter's Five Forces Analysis

4.3 Assessment of the Impact of COVID-19 on the Market

5 MARKET DYNAMICS

5.1 Market Drivers

5.1.1 Growing Applications in Telecommunications and Data Centers

5.1.2 Investments and Research to Miniaturize the PICs

5.2 Market Challenges

5.2.1 Continued Demand for Traditional ICs

5.2.2 Optical Networks Capacity Crunch

6 Market SEGMENTATION

6.1 By Type of Component

6.2 By Type of Raw Material

6.3 By Integration Process

6.4 By Application

6.5 By Geography

7 COMPETITIVE LANDSCAPE

7.1 Company Profiles

8 INVESTMENT ANALYSIS

9 FUTURE OF THE MARKET

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