Massive networks are being created globally in the areas of 5G, FTTx, and Open RAN, with an increased focus on optical connectivity. This has led to rapid growth in fiber demand and a buoyant outlook by industry players.
We are in the midst of a multiyear network build cycle across the globe. The three investment cycles, 5G, FTTx and citizen network built by the governments have coincided, and are expected to continue for the next 7 to 10 years.
Network creators and governments are investing heavily in digital infrastructure. The US government allocated USD 170 billion to increase broadband access, especially in rural and suburban areas. While the Coronavirus Aid, Relief & Economic Security (CARES) Act and American Rescue Plan Act (ARPA) are funding for broadband access in the next 2–3 years, the Rural Digital Opportunity Fund (RDOF) aims to provide more than USD 20.4 billion over the next 10 years to connect unserved rural areas. The telcos in US are investing to nearly double the fiber footprint between now and 2027. AT&T is investing in multiyear connectivity with frontal communications to massively ramp up its fiber across 25 states.
France has allocated €570 billion (USD 690 million) to roll out fiber to the country’s rural areas, with the aim of achieving full coverage by 2025. Deutsche Telekom is investing in targeting 2 million FTTH connections in FY22, after adding 1.2 million connections in 2021. Telefonica, Germany is investing almost €4 billion to connect 50 percent of the population with 5G. The telco is joining forces with the US financial investor KKR to accelerate fiber rollout by creation of JV Open Dutch Fiber, with an initial investment volume of € 700 million. KKR has made investments in FiberCop in Italy, Hyperoptic in the UK, Deutsche Glasfaser in Germany, Telxius in Europe and Latin America, Hivory in France, Global Technical Realty in Europe, Bharti Infratel in India, and Pinnacle Towers in the Philippines.
Meta, erstwhile Facebook, plans to increase its CapEx to USD 31.5 billion in 2022, up from USD 19 billion and that will have massive investments on the optic fiber and the data center build out as well.
Strong investment growth is expected at TIM, Oi, Net/Claro, alongside ambitious FTTH connectivity plans. Notable connectivity projects, such as Programa Norte Conectado, which aims to connect 9.2 million people in the Amazon region through a 10,000 route-km of optical cables is planned over the coming years.
With 1.2 million 5G base stations, to be tripled by 2025 and 400 million 5G subscribers already, China is poised to be the global leader in 5G and also 6G. This will be a sustained investment by all the three large operators toward 5G, implying a huge fiber optic investment.
On the government side also various incentives and programs are now being announced. Italy government has announced €4 billion to connect a further 6.2 million people with fiber and 5G. The big program in the US in terms of the investment of affordable connectivity program is USD 14.2 billion successor program to the emergency broadband benefit, which will help almost 9 million people afford internet access. And even countries in Africa, like the Rwanda government, have borrowed USD 100 million from Asian Infrastructure Development Bank to fund broadband and digitize public services.
Fiber is the backbone for all of these networks. Communication service providers, as well as hyperscalers are aggressively investing in fiber for their networks. The OFC global demand is expected to reach 634 million fiber kilometers by 2026 from 500 million in 2021. In the year 2022, the OFC demand is set to grow by almost 8.6 percent to 544 million fiber kilometers.
In India too a strong fiber deployment is expected to start in FY23. BharatNet under the PPP model in 17 states plans to cover 360,000 villages. The government shall provide ₹20,000 crore as a viability gap funding and the private partners will bring an equity investment of CapEx, operations and maintenance of the network, translating to a tremendous need for deployment of fiber for the coming couple of years.
|BharatNet Project status
|Length of OFC laid||5,70,115 kms|
|No of GPs connected on OFC||1,83,306|
|No of service-ready GPs (on fiber & satellite)||1,77,015|
The Indian telcos are also expected to deploy approximately 200,000 cubic kilometers in FY23 to strengthen the fiber backbone to enable the 5G and standard 4G and FTTx. 5G will require 100 percent of wireless points to be connected on fiber, and hence a very large cumulative network will need to be built out a fresh fiber network.
Fiberisation of towers would play an essential role in getting India ready for 5G. While the current capacity per tower site is about 200 mbps for 2G/3G/4G services, for 5G service, the capacity needed for each site will increase to 1-5 Gbps, which will require fiberized backhaul. At present, the fibre connectivity to the telecom tower stands at 31 percent on pan India basis. The National Broadband mission has envisaged the Fibre to the Tower percent to grow to 70 percent by 2024 in order to support 5G.
Currently, out of 2,30,7068 Base Transceiver Stations (BTS), only 793,551 BTS are connected to fibre accounting to total 34.4 percent in the country. Some of the large states including Delhi, Uttar Pradesh, Bihar, Gujarat are merely 30 percent fiber connected, way far behind the set target of 70 percent and few states like Himachal Pradesh are not even 30 percent fibre connected presently.
The CapEx requirement would be around ₹5,000 Crore to reach 70 percent tower fiberisation by 2024.
The telcos require to add more fiber to their networks to remain relevant and fully monetize their network investments. Till now, wired and wireless networks have been built, relatively independent of each other in India. Going forward, sharing infrastructure between FTTH and 5G will become the dominant way to maximize value from CapEx. Deployment of fiber and small cells by tower companies and then leasing it to telecom companies could add topline of tower companies and benefit telecom companies as their CapEx would reduce significantly.
With 25 years of leadership in optical engineering, precision manufacturing and material science, STL has cracked the code for fiberization. The company calls it Opticonn – the end-to-end solution portfolio for optical products. STL’s Opticonn solution portfolio comprises optical fiber, OF cables, and optical interconnect kits. It includes cutting-edge products like Celesta, a super-engineered, high-capacity cables with up to 6912 fibers; Stellar, an optical fiber known for its bend-insensitivity; and TruRibbon-an intelligently bonded cables for data centers and 5G. During FY21, STL further strengthened Opticonn with the acquisition of Optotec, a Europe-based leader in optical interconnect products. The recent collaboration with Openreach is enabling gigabit broadband in the UK. With the company’s Italy manufacturing unit, it is supporting the build-outs for the FiberCop programme and in India, STL is supporting the BharatNet initiative to take broadband connectivity to 600,000 villages.
STL positions itself as an integrated solutions provider for global data networks, with optical preform, fiber, and cables manufacturing facilities in India, Italy, China, and Brazil. The company is also investing in OFC capacity in South Carolina, which will be ready in next six months.
The STL glass and optical fiber manufacturing plant at Waluj is one of a kind. The plant has an end-to-end process for manufacturing glass preform and optical fibers from silicon metal. The procured silicon goes through various chemical processes in the presence of gases, such as chlorine, oxygen, and hydrogen. This process eventually produces glass preform. At the state-of-the-art facilities at Waluj and Shendra in Aurangabad, this preform is melted at high temperatures to draw the optical fiber. The fiber is then coated with resins to enhance its strength and flexibility.
At Rakholi, the reinforced optical fiber is made into cables according to the customer’s requirements. Manufacturing processes involve coloring, stranding, sheathing, coating with protective layers, and so on. Finally, the cables is embossed with the lot number, client number. and STL labelling before being sent for quality checks and assurance. The product is subsequently dispatched.
Over the years, STL has transitioned to sell both the cables and the interconnect solutions, with the interconnect margins being higher than the cables. Also, the vendor is now pivoting from just India to India and UK, leading to healthier margins. The positive here is that in UK the constraint on services is not order book, but execution, speed, and capability, which the vendor is ramping up every month.
And while the OND2021 quarter reported a negative EBITDA of 0.35, the revenue mix continues to have a sustainable momentum. There have been one-time impacts on the revenue as well as on EBITDA. But overall, there has been growth versus the previous year and the QoQ growth is expected to continue next quarter onwards too, and thereabout further ahead. The quarter may not be considered representative of the underlying business performance, as this is a one-time provision. After adjusting for EBITDA, there has been slight softening there as well on primarily because of two reasons. One is the system integration on services business, project mix, the contract mix executed by choice this time. And the second is the investments made as the services business in the European market, UK in particular, expands.
Capability-building impact is seen even this quarter in the margins. The vendor wants to make sure that there is adequate investment to be able to address the great opportunities that lie ahead in the industry in this space. Starting with UK and Europe, the group is gearing up for the massive rollout expected across the globe.
STL’s net debt is stable, with the objective of a net debt to equity ratio of 0.5 by the last quarter of FY23. Overall, the financial objectives have been set for a run rate of ₹100 billion per annum by the quarter four of next fiscal, net debt to equity ratio of under-five and an RoCE of more than 20 percent.
STL currently has an order book of about ₹11,700 crore and hopes to build on that both in India but especially in Europe and the US.
With its global expansion strategy, STL grew its business in its focus markets with ~41 percent coming in from Europe and Middle East and ~12 percent from Americas.
FY21. The company reported ₹4825 crore in revenue and an order book of over ₹10,700 crore, backed by large global deals. STL closed the year with 27 percent YoY revenue growth, and exports at 42 percent. With an EBITDA of ₹854 crore, PAT stood at ₹539 crore for the fiscal.
HFCL supplies optic fiber cables to almost all major telecom service providers in India, and also exports to more than 30 countries. The vendor is also a contributor to the BharatNet program.
The company is expanding its manufacturing capacity and also further modernizing its Goa and Chennai facilities. Its annual OFC manufacturing capacity is 22.5 million fkm (18.5 million fkm) on consolidated basis. Besides volume increase, the company’s portfolio is armed with newer types of cables, including microduct cables, micromodule cables, and advance ribbon cables, among others.
To meet the demand from the last-mile connectivity segment, the company has also expanded its fiber-to-the-home (FTTH) cables annual manufacturing capacity to 7.2 lakh cables km. FTTH capacity expansion is coming up at the company’s Hyderabad plant. HFCL is also planning to expand its global footprints, foreseeing the good export opportunities for OFC-backed by China+1 strategy. During the year under review, the company commenced production of optical fiber cables for FTTH applications from its Hyderabad plant.
With the establishment of a new plant for manufacturing of telecom products and the capacity expansion of optical fiber, optical fiber cables while also augmenting its Goa and Chennai plants, the recent strengthening of the global leadership team and new investments in product development, HFCL is geared up to capitalize on the upcoming growth opportunity in the decade of digital transformation being seen across industry verticals.
HFCL Limited’s revenue for 2021 stood at ₹4935.53 crore, with an order book of ₹5463 crore on December 31, 2021. The company also secured purchase orders of ₹530 crore along with its subsidiary, HTL Limited for the supply of optical fiber cables during the quarter.
In order to build upon its export footprints expeditiously, HFCL has incorporated two new wholly owned subsidiary companies abroad, HFCL Inc., a company registered in United State in the state of Texas, and HFCL B.V., a company registered in Amsterdam in the Netherlands. The team has been strengthened with the addition of Dr Peter Weimann and Jochen Arms. Dr. Weimann has joined as a CTO of the optical fiber and cables business for the Group and Arms as the vice president of sales for the European region. Both the industry veterans possess vast experience. They shall lead HFCL’s global foray into new-generation optical fiber cables products across different industry applications.
New initiatives have also been taken to develop new types of optical fiber cables for export markets.
On the back of these enablers, the management expects to see the financial year 2023 with decent growth in revenue and profitability with a continued shift in the revenue mix. The vendor continues to grow its catalog of products with innovation to emerge as a name to reckon with for its innovative offerings across various markets.
HFCL Limited has also raised ₹600 crore through a QIP issue. The QIP gains shall be utilized toward funding of capital expenditure requirements for setting up of new manufacturing facilities, capacity expansions, and expenditure on R&D and product development.
FY21. During the fiscal, HFCL Limited grew its revenues, and EBITDA and margins saw a healthy increase, notwithstanding the operational challenges. The net sales stood at ₹4422.96 crore as compared to ₹3838.91 crore in FY20, representing an increase by 15.2 percent YoY.
A healthy growth of 13.5 percent took its EBITDA to ₹585.71 crore. Profit-after-tax grew by 3.8 percent to reach ₹246.24 crore. HFCL closed the year with an outstanding order book of ₹6875 crore.
MP Birla Group has three companies manufacturing cables, Birla Cable Limited, Vindhya Telelinks Limited (VTL), and Universal Cables Limited. During 2021 (Jan–Dec) the three companies generated a combined revenue of ₹3112.75 crore.
|Birla Cable Limited
2020-21 (In ₹ crore)
|Vindhya Telelinks Limited
2020-21 (In ₹ crore)
|Universal Cable Limited
2020-21 (In ₹ crore)
FY2021. Birla Cable Limited achieved revenue from operations of ₹328.52 crore. Birla Cable Limited’s OFC business reached the level of ₹165.09 crore during the financial year 2020-21 as compared to ₹121.38 crore in the previous year due to nominal increase in off-take, especially from the long-term customers of the company from the exports segment. Out of this, exports also played an important contributor and it stood at the level of ₹119.50 crore during the financial year 2020-21. The company’s sales turnover from copper cables and structured cable witnessed a fair jump during the financial year 2020-21 increasing to ₹152.80 crore during the financial year under review as compared to ₹93.94 crore in the previous year.
In 2020-21, VTL achieved revenue from operations of ₹1502.05 crore as compared to ₹1883.19 crore in the previous year, a decline of about 20.24 percent, mainly due to the challenges posed by the Covid-19 pandemic and associated economic slowdown during the first half of the financial year. In terms of segmental basis, the whereas cables business segment registered an increase of 6.82 percent in revenue in comparison with the previous financial year due to increased volume of business in specialty cables and associated equipment/accessories achieved during the second half of the financial year. The profit before depreciation and tax for the year stood at lower level of ₹15,583.36 lakh as compared to ₹18,205.48 lakh in the previous year, primarily because of higher commodity prices and overall lower revenue from operations on account of economic and social disruptions caused due to the pandemic.
Other leading OFC manufacturers include Finolex Cables, KEC International, Aksh Optifiber, and Paramount Communications.
|Finolex Cable Limited – 2020-21
(In ₹ crore)
|KEC International Ltd – 2020-21
(In ₹ crore)
BharatNet, proposing to provide broadband, and connectivity to over 250,000 gram panchayats covering nearly 650,000 villages of India, seems to be in troubled waters. Having completed Phase-I, connecting 100,000 village councils covering 300,000 villages in December 2017, the tender for nearly ₹30,000 crores under public-private partnership (PPP) model for the remaining 150,000 gram panchayats, and all the individual inhabited villages under those panchayats spread across 16 states, was floated in 2021 with target date for broadband connectivity of 2023. End-February 2022, due to non-participation of any bidder Bharat Broadband Nigam Ltd (BBNL) cancelled the ₹19,041-crore tender. When the tender was floated, around 50 companies, including telecom operators, internet service providers (ISPs), over-the-top (OTT) players, and original equipment manufacturers (OEMs) engaged with the government during two rounds of bid interactions. The government issued clarifications for around 3000 queries from the prospective bidders but despite that no participation qualified, says BBNL.
The private players found some of the terms and conditions of the tender onerous, the revenue sharing model proposed by the government not very lucrative, and viability gap funding of ₹19,041 crore meagre. The smaller companies did not qualify as the net worth criteria specified was too high.
A retender is planned with revised terms, with the viability gap funding for private players reassessed. Also, BSNL may become the implementing agency of BharatNet, once a decision on BBNL’s fate is taken. The completion of the project, approved in 2011, is now extended to 2025.
The private telcos, in any case, have expressed dissatisfaction over BharatNet’s fiber, on quality issues around the SLAs in relation to their own fiber that they have rolled out. They have commented that the possibility exists wherein BharatNet becomes a dead network that remains incomplete and under-utilized in perpetuity, wasting taxpayer’s money.
In another proposal, the government has unveiled National Monetization Pipeline, which seeks to generate upfront revenues/investments of ₹6 trillion in four years starting FY22, out of operational infrastructure projects, under various innovative long-term lease plans that do not require the government to cede ownership of the assets much. This includes an attempt to invite private telecom players and investors to bid for BBNL’s 3 lakh km of optical fiber network to upgrade, operate, and maintain across the country including states, such as Haryana and Punjab, where the premium could be high. This transaction (along with BSNL/MTNL tower monetization) could fetch about ₹30,000 crore in FY23.
The global fiber optical cables market is expected to grow from USD 66.54 billion in 2021 to USD 89.91 billion in 2022 at a compound annual growth rate (CAGR) of 35.1 percent, predicts Reportlinker. The growth is mainly due to the companies rearranging their operations and recovering from the Covid-19 impact, which had earlier led to restrictive containment measures involving social distancing, remote working, and the closure of commercial activities that resulted in operational challenges. The market is expected to reach USD 227.54 billion in 2026 at a CAGR of 26.1 percent.
Asia Pacific was the largest region in the fiber optic cables market in 2021. North America was the second-largest region in the fiber optic cable market.
Rising demand for higher bandwidth and faster speed connections will enhance the growth of the fiber optic cables market. There is a surge in demand for high bandwidth from enterprises and individuals due to increased use of the internet for video calls, gaming, online shopping, and social media.
The technological advancement in the fiber optic cables is a key trend driving the growth of the fiber optic cables market. Wavelength division multiplexing (WDM) is the recent technological improvement in fiber cables. WDM is a technique of multiplexing the number of optical carrier signals through a single optical fiber channel by varying the wavelengths of laser lights. WDM allows communication in all directions in fiber cables. WDMs are used on a single optical fiber to blend light signals coming from different optical fibers. This is attained by using a coupler at the WDM input.
Having said that, the increase in the adoption of wireless communication systems is expected to limit the growth of the fiber optic cable market. In recent years, the demand for wireless services has increased exponentially.
Major players operating in the global fiber optical cables market are AFC Cables Systems, Corning Inc., Fujikura Ltd., Furukawa Electric Co. Ltd., Hitachi Cables Ltd., Optical Cables Corporation, Prysmian Group, Sterlite technologies Ltd., Sumitomo Electric Industries Ltd., and Yangtze Optical Fiber & Cables.
|Sterlite Technologies Limited 2020-21 (In ₹ crore)|
|Revenues from operations||4,142.01|
2020-21 (In ₹ crore)
The global market for fiber optic components, estimated at USD 24.2 billion in the year 2022, is projected to reach a revised size of USD 32.5 billion by 2026, growing at a CAGR of 8.2 percent, states Global Industry Analysts, Inc. Transmitters/receivers, one of the segments, is projected to grow at 8.6-percent CAGR to reach USD 15.5 billion by the end 2026. Growth in the connectors segment is readjusted to a revised 9-percent CAGR for the next 7-year period. This segment currently accounts for a 25.2-percent share of the global fiber optic components market.
Fiber optic technology is embraced all over the world due to its innate advantages over the conventionally used copper. Glass optical fiber has high tensile strength as compared to all other mediums. The extremely high pull strength of 150-plus pounds for two-fiber cables is about eight times the strength of Category 5 unshielded twisted-pair copper. Fiber is also comparatively smaller and lighter than copper, rendering it easier to handle and needing less space in floors, ceilings and narrow ducts. Field termination, splicing and testing of fiber-optic cables and connectors is easier, discarding the traditional installation of copper.
The global market for fiber optic amplifiers, used to boost the power of optical signals, thereby extending the distance they can travel over the fiber before regeneration of the signal is required, estimated at USD 1.8 billion, will reach a projected size of USD 2.9 billion by the close of 2026. China will remain among the fastest growing in this cluster of regional markets. Led by countries, such as Australia, India, and South Korea, the market in Asia Pacific is forecast to reach USD 666.1 million by the year 2026, while Latin America will expand at a 7-percent CAGR through the analysis period. USA, Canada, Japan, China and Europe will drive the 6.8-percent CAGR estimated for this segment.
The worldwide market for optical fiber preform, expected to grow at a CAGR of 6.1 percent over the next 5 years, will reach USD 3780 million in 2024, from USD 2750 million in 2021, anticipates MarketWatch. The rising demand for high-bandwidth communication and rapid up-gradation and installation of fiber-rich network infrastructure are the major drivers for optical fibers and hence the preform market. Additionally, the demand for fiber optic cables has been rising owing to the tremendous rise in data traffic and is anticipated to further catalyze the demand for optical fiber. The fiber optic preform market is evolving continuously with intensive research and development into the fiber optic technology, which has enhanced the performance and suitability for applications in the oil and gas, medical, utilities, and defense industries.
Major players operating in the global optical fiber preform market include Yangtze Optical Fiber and Cables Joint Stock Limited Company, Shin-Etsu Chemical Co., Ltd., Sumitomo Electric Industries Ltd., Hengtong Group Co., Ltd., and Corning Incorporated, among others.
The global fiber optics market was estimated at USD 7.4 billion in 2021 and is expected to hit USD 11.1 billion by 2030, expanding growth at a CAGR of 4.6 percent from 2021 to 2030, estimates Precedence Research. The increasing demand for internet services is the key factor driving the market. Owing to the rapidly growing digitally literate population, the demand for high-bandwidth communication and data-transmission services is on the rise, which has led to the steady growth in the telecommunications and information technology sector. This has consequently increased the demand for fiber optics as it is integral for effectively transmitting data, voice messages, and images over vast distances. Furthermore, innovations, such as 5G network, fiber to the home (FTTH), and fiber to the building (FTTB) have amplified the positioning of broadband network systems, which provide high-speed data and related services to the consumers.
Moreover, fiber optic internet is considered more reliable and less susceptible to breakdown during power outages as fibers are made of glass and do not require electricity to function. In the healthcare industry, this technology has extensive application in the field of imaging, wherein X-ray, surgical endoscopy, and microscopy, ophthalmic lasers, and light therapy are some of the key medical procedures that use fiber optics. The growing demand for minimally invasive surgeries is another critical factor, driving their demand in this industry. However, rising trend for wireless communication may restrict the market growth. The wireless communication uses microwave radio spectrum for transmitting data from one point to another. Fiber space optics (FSO) and radio frequency (RF) are the most preferred techniques for wireless communication. Some of the benefits offered by wireless communication over fiber optics are non-interference of FSO and RF waves, along with less capital required for installation. Nevertheless, significant investment by prominent market players to upgrade and develop the technology application arena is anticipated to present promising growth for the market in years to come.
In 2021, the global fiber optics market was dominated by the multimode segment with nearly half of the market revenue share, and is expected to retain the leading position in coming years. Single-mode and multimode segments exhibit moderate growth. Single-mode fiber optics is used for long-distance applications, ranging from 2 to 10,000 meters. It also offers low power loss as compared to its counterparts, i.e., multimode and plastic optical fiber. Plastic optical fiber encountered the highest growth opportunity with its dynamic applications and cost saving feature. The plastic optical fiber has core made from polymer while single and multimode fibers have core made from glass – this attributes for the overall cost reduction of the product type.
Telecommunication sector accounted for the largest revenue share in the global fiber optics market and is projected to retain its position over the next 9 years. In addition, the segment offers promising growth aspects in the years to come owing to increasing adoption of fiber optics in data-transmission services and communication. The technology enables high speed transfer of information in both long- and short-range communications. Furthermore, increasing demand for video-on-demand service, cloud-based applications, and audio-video services stimulates the market growth of fiber optics in telecom sector.
The global fiber optic test equipment market is estimated at USD 873.54 million in 2021. It is expected to reach USD 1346.82 million by 2027, registering a CAGR of 7.15 percent from 2022 to 2027, forecasts Mordor Intelligence. As the telecommunication industry is rapidly adopting fiber optic cables for attaining high-speed data transfer, the importance of testing equipment for these has increased over the years in manufacturing, inspection, on-field troubleshooting of network systems, as well as research and development phases across the industries.
Asia Pacific region is expected to witness the fastest growth. Data centers are one of the largest consumers of fiber optics, which enables the data centers to provide high-speed data transmission with fewer complexities of connections between racks of switches and other parts of the data centers. Owing to the high power consumption of data centers, researchers have been investing in increasing the use of low-power fiber optics. The rise in the number of data centers in the region is estimated to increase the demand for fiber optic test equipment in the market.
Presently, Japan-made optical fiber cables products are renowned around the world for their advanced innovations and high-end qualities. Japan has been one of the leading global optical fiber cables producers and exports over the last few years. In June 2021, Japan set an internet speed record by transferring 319 Tb/s over 3001 km. In November 2021, Fujikura Ltd. announced that AFL, a subsidiary of Fujikura Ltd., Japan, officially opened its new fiber optic cables facility in Swindon, Wiltshire, starting commercial production of Fujikura’s air blown wrapping tube cables (AB-WTC), using Spider Web Ribbon® (SWR®) fiber technology in the United Kingdom. All of these factors are expected to grow the demand for fiber optic test equipment market in the Asia Pacific region in coming years.
The market for fiber optics test equipment is fragmented due to the presence of high competitive rivalry among the market players. Also, these companies are extensively investing in offering a wide range of technologies to the customers for application-specific field measurement, monitoring, and maintenance. Moreover, these are the companies that are continuously investing in making strategic partnerships and acquisitions along with product development to gain more market share.
The constant research work in the field of optical fiber is in progress globally on the topics of Space Division multiplexing of fiber, hollow core fibers, and few mode fibers, and these innovations have the potential to further increase the bandwidth of a single fiber many times, along with several other enhanced features. Such fibers will be extremely useful for internal wiring of, say, large data centers and also for long-distance submarine applications, requiring high international bandwidth.
Space division multiplexing in optical fibers. Optical communication technology has been advancing rapidly for several decades and much of this progress has been in finding innovative ways to increase the data-carrying capacity of a single optical fiber. The multiplexing in time, wavelength, polarization, and phase have already been achieved and commercial systems now utilize all four dimensions to send more information through a single fiber. The spatial dimension has, however, remained untapped in single fibers. It is possible to manufacture fibers supporting hundreds of spatial modes or containing multiple cores, which could be exploited as parallel channels for independent signals. The use of high-capacity SDM optical fiber cables is expected to support the implementation of economical core/metro high-capacity optical networks with a capacity of more than 1 Pbit/s. In ultra-long-haul submarine cables systems that must accommodate the traffic growth of international communications, SDM optical communication technology is expected to offset the capacity crunch of conventional single-mode fiber (SMF)-based systems and power supply constraints, both of which are critical constraints in ultra-long-haul submarine cables systems.
Hollow core fiber. Single-mode optical fiber has been the key building block of long-haul optical transmission networks, developed and installed. In recent years, however, the telecom community has become acutely aware that at the current data traffic growth rates, SMF-based networks will reach their practical capacity limits within the next decade or so, and will therefore be unable to support future traffic demands, leaving little options beyond costly deployment of ever more fiber. Much activity has been devoted to fiber designs, enabling the incorporation of multiple spatial channels within the same fibers (including for instance multicore and few-mode fibers, as well as combinations of the two) – an approach which is termed spatial division multiplexing. However, there are other ways in which transmission capacity could be boosted, such as hollow core photonic bandgap fibers.
The cumulative fiber count across the globe till 2020 was about 5.6 billion fiber kilometers. This is expected to go up to 12 billion fiber kilometers till 2030, which means the current decade will see 6.4 billion fiber kilometers being deployed and making it by far the biggest and the best decade. In the coming years, another 7 billion will be required, and next-generation technologies like 6G will undoubtedly necessitate even more dense fiber networks. If the next decade of network creation is to be done on the back of fiber, then the next wave of innovation has to come in the area of fiber deployment.
The surge in work-from-home culture, along with the need to extend connectivity and improve the overall experience for broadband users, has opened new opportunity to deliver and meet the huge demand for high-speed bandwidth requirements with quality services. Consequently, demand for optical fibers and associated materials is expected to witness exponential growth worldwide in the coming years. The global fiber optic connectivity market is expected to derive growth from increasing downstream activities and growing internet usage across the world.
It is estimated that by the end of 2025, there will be over 6.5 million 5G base stations across the world, which will put the focus sharply on high-quality optical fiber cables manufacturing and its performance. The cables used for rollout of 5G should be capable enough to take all the future load on the network. Most operators and network deployment companies along with OFC manufacturers around the world have been trying to get the right product mix for this new technology and different parts of the optical transport network. OFC manufacturers are also investing heavily in their R&D capabilities to develop high fiber count compact designed products with superior optical performance and capability to provide connectivity between complex data centers environment.
OFC production is certainly poised for a massive leap!