Global PON equipment market to grow at 23.14 pc CAGR

DUBLIN, IRELAND: The analysts forecast the Global Passive Optical Network (PON) Equipment market to grow at a CAGR of 23.14 percent over the period 2012-2016. Research and Markets in its report shows that the increasing growth of PON equipment in China is a major growth driver. In China, there is a transition toward optical-wired communication from wireless communication.

The mass adoption of electronic gadgets and the data traffic created by the huge volume of customers are driving end-users in the country to switch from a wireless to a wired optical medium.

With the deployment of 10G and 40G optical transmission networks in recent years, there is an upsurge of deployment of higher capacities. Many vendors such as Alcatel-Lucent, Ciena, and Huawei have announced that they are going a step further in the future by innovating and conducting trials for capacities as large as 400G and 10 petabits per second transmission.

Although the capacities are much larger than required currently, they are considered as future investments considering the huge expansion in data traffic.

Further, the report states that one of the main challenges is declining average selling prices of equipment. Semiconductor optical devices are used for high data volume applications and their prices have fallen significantly during the past 10 years. Buyers and vendors in the optical industry have become highly competitive and cost sensitive. Thus, there is always pricing pressure from customers which affects the profits of the company.