Next-gen transceivers to generate US$15.9bn in 2028 – report

Created February 6, 2023
News and Business

Communications Industry Researchers (CIR) has issued Next Generation Transceivers Markets: 2022-2028, a new report which predicts next-generation transceivers will generate US$15.9 billion by 2028 compared to US$850 Million in 2023 as 800G speeds and above move into the mainstream.

It says that embedding new approaches–such as coherent optics, co-packaged optics, and more efficient designs—next generation transceivers will be better suited to the needs of the network as demand increases and applications become more latency sensitive.

(Image: CIR-INC)

The report also finds:

  • Data rate requirements for optical transceivers will grow rapidly as Internet and 5G/6G users increase and latency-sensitive traffic from AI, machine learning (ML), Internet-of-things (IoT) and virtual reality traffic proliferate. Transceiver makers are responding to bandwidth challenges by introducing coherent transceivers throughout the network, even the access segment (Coherent PONs).  By 2028, CIR says that coherent transceivers will rack up almost US$4 Billion in revenue. Nonetheless, transceivers will eventually migrate towards co-package optics as well as engineer a new range of transceivers for edge data centres
  • PON transceiver markets are about to grow. New transceivers will be required to support “Combo” PONs and “Coherent PONs,” which are PON networks that can carry traffic from many kinds of PON infrastructure. Next-generation PON transceivers will clock up US$300 million in revenues by 2028
  • Transceiver supply chains will simplify considerably in the next few years.  It is unlikely that the two-tier pricing structure for transceivers will survive as links in the supply chain consolidate.  Expect the role of distributors to decline, while OEMs play a growing role in transceiver manufacturing. This latter trend will help cope with the increasing unreliability of China as a transceiver source.

The report also analyses the size and timing of opportunities in the next-generation transceiver space until 2028, examining the marketplace value created first by coherent technology and ultimately by co-packaging.  In addition to a granular forecast from 2023 to 2028 CIR has included a quantitative historical sizing of the next-generation transceiver market in 2022.  In addition, the report provides profiles of the following transceiver market influencers and their activities related to next-generation transceivers:  Accelink, Ciena, Cisco, Coherent, Eoptolink, Fujitsu, Huawei, Infinera, Intel, Innoloight, Juniper, Lessengers, Limktel, Lumentum, Marvell, Molex, Source Photonics, and Sumitomo.

According to report author Lawrence Gasman, president of CIR, “We are entering exciting new times. In future transceivers will no longer be just a transmitter plus receiver with some simple electronics thrown in.  Transceivers will become smart modules appropriately designed to simplify network architecture and enable more flexible network configurations.”

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This article was written
by Peter Dykes

Peter Dykes is a independent telecoms and technology journalist who has over that last 30 years written for a wide range of B2B publications and companies. A former BT engineer, he specialises in networks and associated support systems. He is currently Editor of Optical Connections.