PON Market to Grow at 3.6% Through 2018

According to Radiant Insights, the global passive optical network (PON) equipment market is projected to grow at a CAGR of 3.6% from 2013 ...

Radiant Insights
Radiant Insights

According to Radiant Insights, the global passive optical network (PON) equipment market is projected to grow at a CAGR of 3.6% from 2013 to 2018 (forecast period). The research house says large-scale penetration of smartphones and exponential growth in the number of household Internet users are the main growth drivers. An ongoing shift by network providers to fiber-to-the-home (FTTH) services is also expected to generate PON demand. FTTH applications are on the rise owing to introduction of high-speed services to accommodate streaming video and other bandwidth-intensive applications.

Rising use of data-intensive services (video conferencing, VoIP, VOD) is expected to have a favorable effect on market demand over the forecast period. However, stringent governmental regulations coupled with high installation and operational costs could be a challenge.

The worldwide market is fragmented on the basis of technology into Gigabyte PON (GPON) and Ethernet PON (EPON). GPON occupies a higher share of the total market. It is expected to grow faster than EPON in the coming years. GPON delivers increased bandwidth capabilities as well as triple play services over a single fiber to residences and office premises. This segment is expected to grow on account of increasing focus on upgrading the existing networks to PON to increase broadband speeds. EPON is primarily employed in local area networks (LANs).

The passive optical network equipment market is geographically segmented into the Americas; Asia Pacific (APAC); and Emerging Markets, Europe & Africa (EMEA). Consumption of PON equipment in APAC is the chief driver of the global PON equipment market. Countries like Japan, China and India are increasingly demanding higher bandwidth. High investments in research and development in APAC are also expected to propel the region's PON equipment demand.

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