An optical transport network is a telecommunications network that utilizes optical switching, multiplexing, routing, and transmission. It works as an optical counterpart of electronic communications and is used for transferring large quantities of data, including telephone calls, internet traffic, and cable television signals for long-distance communications. Optical networking technology has significantly evolved from SDH/SONET to DWDM and is now moving towards higher bandwidths through coherent optical technology and dense wavelength-division multiplexing. Telecom operators are transitioning towards flex-grid ROADM networks and elastic optics to cater to exponentially increasing bandwidth demand fueled by 5G migration, cloud apps, video streaming and IoT. The global optical transport network market is estimated to be valued at US$18 Billion in 2023 and is expected to exhibit a CAGR of 4.5% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Optical Transport Network Market is Expected to be Flourished by Growing Demand for Bandspeed upgrades
One of the key driver propelling the growth of optical transport network market is growing demand for higher bandwidth. As data traffic is increasing exponentially owing to higher usage of virtual platforms, cloud applications and streaming services, telecom operators are upgrading to higher bandwidth systems to keep up with demand. Optical networks with flexible bandwidth switches and coherent technology enables scaling of bandwidth dynamically in increments of 50-400 Gbps in nodes. Another driver is increasing investment in 5G infrastructure deployment globally. As 5G networks require 10-100 times the bandwidth than 4G, it has accelerated the demand for optical transport network upgrades. Dense wavelength-division multiplexing (DWDM) combined with 5G wireless infrastructure enables carriers to expand capacity and support bandwidth intensive services like 4K video.
The optical transport network market is dominated by the WDM segment. Within WDM, the DWDM technology accounts for the largest market share owing to its ability to manage larger network capacities as compared to the CWDM technology. The adoption of DWDM networks is high among telecom service providers as these networks help meet the ever-increasing demand for bandwidth.
Political: The government initiatives toward digital transformation and focus on rural connectivity are driving investments in optical fiber cables and bandwidth infrastructure in several countries.
Economic: Growing GDP and rising disposable incomes have increased the demand for broadband and mobile internet. This is augmenting the need to enhance network capacities which is fueling market growth.
Social: Rapid urbanization and increasing penetration of smartphones have boosted the data consumption. The rising dependence on internet for various activities is propelling the need for robust telecommunication infrastructure.
Technological: Advances in network technologies such as software-defined networking and network functions virtualization have enabled efficient bandwidth utilization. Improvements in components such as transmission equipment are also extending the transmission speeds.
The global Optical Transport Network Market Growth size is expected to witness high growth over the forecast period.
North America and Europe are also significant markets for optical transport networks. The early adoption of next-gen networks in these regions and continuous network expansion by telecom operators are supporting the regional growth.
Key players operating in the optical transport network market are Huawei Technologies Co., Ltd., ZTE Corporation, Cisco Systems, Inc., ADVA Optical Networking, Infinera Corporation.
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it