The optical communication and networking equipment market is projected to reach $36.6 billion by 2027 from $24.2 billion in 2022, growing at a CAGR of 8.6 percent from 2022 to 2027.
Growing adoption of data centers and the deployment of VoIP, 4G, and 5G networks are the major driving factors for the growth of the optical communication and networking equipment market.
The research report said optical communication and networking equipment with up to 40 Gbps data rate accounted for the largest market share of ~49 percent in 2021. The market for optical communication and networking equipment with greater than 100 Gbps data rate is projected to grow with the CAGR of 9.8 percent during the forecast period.
With the rapid development of 5G and high-performance services brought by cloud networks, the demand for higher bandwidth devices with a data rate of greater than 100 Gbps is expected to grow in the near future.
The data center application is expected to dominate the market. The application is also expected to grow at the highest CAGR during the forecast period. The rise in the number of OTT platforms (Netflix, HBO, Disney, and Amazon Prime) over the year are expected to propel the data center market in the future.
The Americas accounted for the largest share of ~40 percent of the optical communication and networking equipment market in 2021 because the Americas has emerged as a major data center and cloud computing hub.