22 June 2020
Silicon photonics market to grow at 23.4% CAGR from $1bn to $3bn in 2025
The silicon photonics market is projected to grow at a compound annual growth rate (CAGR) of 23.4% from $1bn in 2020 to $3bn by 2025, forecasts the report ‘Silicon Photonics Market with COVID-19 Impact, by Product, Application, Component And Geography - Global Forecast to 2025’.
Factors accelerating growth are the rising demand for CMOS-integrated silicon photonics technology in data centers, the growing focus on reducing power consumption using silicon photonic transceivers, the increasing requirement for high bandwidth and high data transfer capabilities, and the surging demand for high-speed broadband services. Increasing government and stakeholder funding, growing deployment of 5G networks, emerging applications of silicon photonics, and surging utilization of silicon photonics technology in short-reach communication provide lucrative opportunities to the silicon photonics market, the report notes.
Silicon photonic transceivers to lead market
Silicon photonic transceivers are expected to lead the silicon photonics market during 2020–2025, primarily due to their reduced power consumption and high integration density, enabling high-speed data transmission. Further, these transceivers can be upgraded to handle higher-capacity bandwidth, enabling optical modules to handle data-center network speeds of up to 100Gbps, 400Gbps, and beyond.
Additionally, the growing adoption of silicon photonic transceivers in data centers is another primary factor for the leading position of these transceivers in the silicon photonics market during the forecast period. For instance, Alibaba Cloud will be using 400G DR4 optical transceivers to support its next-generation data-center network.
Laser components to see highest growth rate
Hybrid silicon lasers (silicon and III-V semiconductors) are used to overcome mass-production issues in silicon lasers. The hybrid approach takes advantage of the light-emitting properties of III-V semiconductor materials combined with the process maturity of silicon to fabricate electrically driven lasers on a silicon wafer that can be integrated into other silicon photonic devices.
Intel is working on hybrid silicon lasers with indium phosphide (InP)-based materials and other compound semiconductor materials.
APAC to be fastest-growing market for silicon photonics
China, Japan and South Korea are the major contributors to the market. Growing population, increasing investments toward the development of silicon photonic products, the rising focus of international and domestic players on the development of modern silicon photonic products, and increasing R&D activities to increase the data transmission rate in the region are also fueling market growth.
The report cited the key players in the global silicon photonics market as Cisco, Intel, MACOM, GlobalFoundries, NeoPhotonics, InPhi, Mellanox, II-VI Inc and Rockley Photonics (all US-based).