According to the Dell'Oro Group, the optical transport equipment market is projected to reach $16 billion by 2022. Wavelength division multiplexing (WDM) systems are expected to contribute 95% of the market's revenue.
"We expect demand for optical equipment to continue rising," said Jimmy Yu, vice president at Dell'Oro. "Although the shift away from legacy optical transport equipment will continue to weigh down the market's top line revenue, we foresee a rising use of WDM systems as service providers continue to expand their fiber footprint and Internet content providers continue to install more optical transport capacity between their global data centers."
Other findings indicate:
- The cumulative spend on optical equipment during the next five years is projected to be $75 billion.
- Due to service providers' plans for faster mobile (5G) and fixed (Gfast, 10G PON, and DOCSIS 3.1) broadband speeds, requiring fiber to reach closer to end users, demand for WDM systems is expected to increase the most in metro access and aggregation.
- Data center interconnect (DCI) is forecast to account for 18% of WDM systems revenue by 2022.