by Photonic integrated circuits (PICs) have transformed optical communications and sensing by enabling the miniaturization and integration of multiple photonic components and functions on a single chip or substrate. PICs allow for photonic components like waveguides, modulators, switches, lasers, and detectors to be integrated at microscopic scales using similar design and manufacturing techniques used in electronics. Their small size, parallelism, and reliability make PICs ideal for use in applications like data centers, 5G networks, LiDAR, medical imaging, and more. PICs can route and process optical signals at high speeds with very low power consumption, enabling applications requiring high bandwidth connectivity over both short and long distances.
The global Photonic IC Market is estimated to be valued at US$ 3535.23 Mn in 2024 and is expected to exhibit a CAGR of 5.2% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
One of the major trends driving growth in the photonic IC market share is the rapid increase in data traffic globally. 5G networks and increased adoption of fiber to the home/premises are generating exponentially higher data every year that needs to be transmitted and processed optically. Traditional electrical communications are reaching their bandwidth limitations, necessitating the transition to photonic solutions. PICs provide the flexibility, scalability and efficiency to handle current and future bandwidth demands. Another trend is the expansion of LiDAR applications in autonomous vehicles, drones and industrial robotics. Mass adoption of these technologies will spur more sophisticated 3D sensing capabilities requiring integrated photonic solutions for compactness and cost effectiveness. Advancements in design and manufacturing technologies are also lowering the costs of PICs, making them viable for a wider range of commercial and consumer applications beyond just telecom networks in the coming years.
Porter’s Analysis
Threat of new entrants: The threat of new entrants is moderate. High capital investments required for R&D and manufacturing facilities are barriers for new players in the market.
Bargaining power of buyers: The bargaining power of buyers is high as photonic ICs have applications across various end-use industries including telecommunications, data centers, etc. Buyers can negotiate for better prices and quality.
Bargaining power of suppliers: The bargaining power of suppliers is moderate as there are many component suppliers for photonic ICs available globally. Switching costs are also low.
Threat of new substitutes: The threat of substitutes is low as there are no close substitutes for photonic ICs currently.
Competitive rivalry: The competitive rivalry is high among existing players. Players compete on the basis of technological innovations, pricing, quality, and customization.
Key Takeaways
The global Photonic IC market is expected to witness high growth. The global Photonic IC Market is estimated to be valued at US$ 3535.23 Mn in 2024 and is expected to exhibit a CAGR of 5.2% over the forecast period 2024 to 2031.
North America dominates the market currently due to high demand from telecommunication sector. Presence of major players and technological advancements. Asia Pacific is expected to grow at the fastest pace during the forecast period supported by rising electronics industry in countries like China, Japan and investments in optical networks by telecom operators in the region.
Key players operating in the Photonic IC market are Cargill Inc.,Tate & Lyle PLC,Corbion N.V.,Firmenich SA,Sensient Technologies,Associated British Foods Plc.,Givaudan,Takasago International Corporation,Mane SA,International Flavors & Fragrances Inc. (IFF),Quest Nutrition LLC,Danisco A/S. Major players are focusing on new product launches, partnerships, and expansions to gain market share.
