The optical transceiver industry growth include growing demand for cloud computing applications

[168 Pages Report] The global optical transceiver market size is expected to grow from USD 5.7 billion in 2020 to USD 9.2 billion by 2025, at a CAGR of 10.0%. Increasing adoption of smart devices and rising data traffic, growing demand for cloud computing applications, and rising demand for compact and energy-efficient transceivers are the factors driving the growth of the optical transceiver industry. The emerging focus on the 5G network, increasing demand for high data transfer capabilities, and expansion of telecom infrastructure in developing economies are likely to provide growth opportunities to the optical transceiver industry players during the forecast period.

Optical transceivers with QSFP, QSFP+, QSFP14, and QSFP28  form factors to drive the growth of the market  during the forecast period

The Quad small form-factor pluggable (QSFP) form factor of optical transceivers is designed for high performance and low power consumption, which makes them ideal for data center applications. With the advent of technological advancements such as AI, machine learning, and 5G communication, data traffic is increasing, which in turn is creating demand for high scale data centers. QSFP supports higher data rate transmissions such as 100G, 200G, and 400G, among others. Hence growing demand for high data rate transceivers would drive the growth of QSFP optical transceivers market during the forecast period.

The optical transceiver market for less than 1 Km distance to grow at highest CAGR during the forecast period

Transitioning of high scale data centers towards the adoption of high data rate components, including transceivers for data communication owing to technological advancements, such as AI, machine learning, and 5G communications, is driving the growth of optical transceivers operating within 1 Km range. Data centers are operated for short distances and require a high data transmission rate for transferring huge packets of information. The increasing need for high-speed communication in data centers is also driving the market for high data rates optical transceivers such as 100G and 400G for less than 1 Km.

Datacenter application to grow at the highest CAGR during the forecast period

Optical transceiver market for data centers is expected to grow at the highest CAGR due to factors such as transitions towards cloud storage and increasing technological developments including machine learning, artificial intelligence, and deep learning which in turn increases data traffic across networks which create demand for high data rate transceivers for efficient data communication. Optical transceivers are used for either interconnect or intraconnect networks. Interconnect networks are used for connecting two or more data centers over short, medium, or long distances, with the help of high optical connectivity and components such as optical transceivers. The Intra-data center networks are those which are used for connecting networks within the data center. Usually, the range of data transmission is less than 1 Km but, sometime sit can range up to a maximum of 10 Km. Multimode fibers are mostly preferred for intra-data center connections.

The development of hyperscale data centers is also driving the growth of high data rate optical transceivers, such as 100G, 200G, and 400G for channeling huge packets of information in a short span. Moreover, leading cloud service providers such as Google, Amazon, and Microsoft are implementing high data rate transceivers in their data centers. Recent trends such as driverless vehicles, wireless communication, smart gaming, and entertainment devices, among others, are expected to increase data traffic across networks, which would drive the demand for high-speed optical transceivers to a great extent.

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