A few days ago, LightCounting released the latest market report. According to its recently completed supplier survey, in Q4 2021, the shipment volume of optical modules set a new record, with a single quarter sales of $2 billion, an overall increase of 37%, of which the sales of Ethernet and WDM optical modules increased by about 40%.
Ethernet optical module follows IEEE 802.3 standard and is mainly used in data centers, campus networks, etc. Its transmission rate can currently support 155M-400Gbps. Common packages include SFP, SFP+, SFP28, SFP56, QSFP+, QSFP28, QSFP-DD, etc. The types of Ethernet optical module include dual-fiber optical module, BIDI optical module, wavelength division module, etc. Ethernet optical module is applied to Ethernet switch, and Ethernet switch has diversity, which is reflected in stackability, number of ports, transmission rate, etc.
WDM, or wavelength division multiplexing, is a technology that combines multiple optical signals of different wavelengths through a combiner and couples them to the same optical fiber to transmit data. The biggest difference between optical modules using WDM technology and ordinary optical modules is that they can better save fiber resources and costs. At present, the 25G WDM optical modules commonly used in the market are divided into 25G CWDM optical modules, 25G DWDM optical modules and 25G LWDM optical modules, which can be applied to the short-distance data transmission in switches, routers, network interface cards and storage network devices of 25G Ethernet respectively; It is widely used in 25G Ethernet and 5G forward CPRI/eCPRI networks; It is applied to 25G Ethernet medium and short distance transmission.
LightCounting said that the average price rise of some important categories of products in 2021 was a major reason for the record performance of optical module suppliers. Compared with 2020, the sales of Ethernet and WDM segments will increase by 28% and 27% respectively in 2021. The average price of Ethernet optical module products increased by 21%, and the average price of WDM optical module products increased by 37%. It is understood that in these two market segments, the product structure is changing from products with lower performance to products with higher performance, which increases the average price.
In terms of the Ethernet optical module market, LightCounting predicted in a market report in 2021 that the sales of 400G and 2x400G (800G) modules will maintain the growth of the global Ethernet optical module market in 2021-2026, with a compound annual growth rate slightly higher than 10%. The sales of 100GbE modules are expected to remain stable, slightly higher than US $2 billion annually. By 2026, the total market of Ethernet optical modules is expected to reach 6.8 billion US dollars, which does not include the sales of optical devices co-packaged with switching ASICs. The data presented in this market report also confirmed this statement to some extent.
In the WDM optical module market, with the development of 5G, the Internet of Things and smart communities, more bandwidth needs will be brought. The wide application of WDM technology is also a major trend of the current industry development. Its market demand mainly comes from the upgrading of optical network of downstream telecom operators and the construction of IDC internal and IDC interconnection of Internet service providers. Therefore, WDM's ultra-large capacity transmission, saving optical fiber resources, easy to upgrade and expand, supporting ultra-long distance transmission and reducing costs, and high reliability as optical devices also make WDM optical module market steadily rise at present.
Although recent changes in the international situation and the repeated COVID-19 have caused fluctuations in the supply chain of raw materials, which will have a certain impact on the optical module market in the next period of time, in general, with the development of communication technology, the steady growth of the demand side will still bring considerable dividends to the optical module market.