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Coherent optical transceiver shipments to grow at 17 percent CAGR

Dell’Oro Group, the trusted source for market information about the telecommunications, security, networks, and data center industries, forecast coherent optical transceiver shipments to grow at a 17 percent compounded annual growth rate (CAGR) for the next five years. Additionally, the Coherent Optics market is undergoing a tectonic shift with the availability of small form factor pluggable optics that will increase the use of coherent technology in routers and ethernet switches.

“The demand for coherent technology is expanding,” stated Jimmy Yu, Vice President for Optical Transport market research at Dell’Oro Group. “This is in part due to the continuous need for better, lower powered, and higher capacity transceivers that meet future global network requirements,” added Yu.

“Historically, the majority of coherent optics have predominantly found their application in DWDM systems,” stated Sameh Boujelbene, Vice President for Ethernet Switch market research at Dell’Oro Group. “However, with vendors making strides in developing smaller and more energy-efficient coherent transceivers, the scope of their use is rapidly expanding. This expansion encompasses not only the range of platforms they can support, but also the diversity of applications to which they can cater,” added Boujelbene.

Additional highlights from the Coherent Optics Report:

  • Coherent Optics market is predicted to reach nearly $13 billion by 2027. This growth will be driven by both form factors: Module/Embedded and Plug. Pluggable transceivers are projected to grow at the highest rate and contribute most of the volume growth for the next five years.
  • The use of coherent transceivers on DWDM Systems will continue to contribute the largest share of the market revenue. However, within a short period of time, the use of coherent optics on Router & Switch platforms will reach material levels.
  • Coherent optics deployed on Router & Switch platforms will account for more than 50 percent of the annual increase in transceiver shipments throughout the forecast period. This will be due to the availability of ZR Optics, beginning with 400ZR and carrying through to 1600ZR.


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