$7 billion PON Market By 2022 Says Dell’Oro Group

Created August 6, 2018
Alam Tamboli Senior Analyst, Broadband Access Market ResearchNews and Business

Optical Transport to boom too

According to a newly published report by Dell’Oro Group the worldwide PON market will grow to over $7 billion by 2022. Next-generation PON technologies, including 10 Gbits/s EPON, XGS-PON, and NG-PON2, will drive all of the increase, growing at a Compounded Annual Growth Rate of almost 40% from 2017 to 2022.

“Where PON technologies are used for residential broadband services, 2.5 Gbits/s GPON will remain as the dominant technology due to its lower price and sufficient speeds,” states Alam Tamboli, Senior Analyst at Dell’Oro Group. “However, for a number of growing use cases, such as business services and mobile backhaul, next-generation PON technologies have capacities and capabilities that current generation technologies lack.

“10 Gbits/s EPON has already begun shipping strongly in China where current generation PON is widely deployed,” adds Tamboli. “Shipments of XGS-PON and NG-PON2 remain small for now, but we anticipate that XGS-PON will grow more rapidly. XGS-PON and its 10 Gbits/s symmetric bandwidth should meet operators’ needs for business services and mobile backhaul.”

Some days earlier Dell’Oro released its prediction for the Optical Transport equipment market. That sector was forecast to reach a value of $16 billion by 2022, with the cumulative spend on optical equipment during the next five years projected to be $75 billion. The market research house also forecast that WDM systems would contribute 95% of the Optical Transport revenue.

“We expect demand for optical equipment to continue rising,” said Jimmy Yu, Vice President at Dell’Oro Group. “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 fibre footprint and Internet content providers continue to install more optical transport capacity between their global datacentres.”

Additional highlights from the Optical Transport 5-Year Forecast Report included:

  • Due to service providers’ plans for faster mobile (5G) and fixed (G.fast, 10G PON, and DOCSIS 3.1) broadband speeds, requiring fibre to reach closer to end users, demand for WDM systems will increase the most in metro access and aggregation
  • Datacentre interconnect is forecast to account for 18% of WDM systems revenue by 2022.

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This article was written
by John Williamson

John Williamson is a freelance telecommunications, IT and military communications journalist. He has also written for national and international media, and been a telecoms advisor to the World Bank.