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Global Passive Optical Network (PON) Equipment Market: Snapshot

The global demand for PON equipment is expected to rise quickly due to the superiority of optics in networking. PONs are easily scalable, provide advanced security, are highly reliable for consistency, and help optimize the bandwidth connectivity. Additionally, PON equipment are easy to install and maintain in comparison to conventional networks and also do not emit electromagnetic radiation due to their dielectric nature.

Environmental conservationists are also positive about PON implementation due to their eco-friendly nature, in comparison to conventional copper-based cable networks. PON and its passive local area network also helps eliminate the need for workgroup switches.

Factors such as these are responsible for the extremely optimistic 20.7% CAGR displayed by PON equipment revenue from 2015 to 2023. This market is expected to be valued at US$163.50 bn by the end of 2023.

High PON Equipment Demand in Asia Pacific Draws Global Players to the Region

Asia Pacific is currently showing a very high demand for PON structures and equipment. Most of this demand increase is attributed to the rapid network implementations of China and India. China has played a key role in the growth of PON equipment players in the recent past and is expected to continue doing so for the coming years. A factor that allows China to show a higher PON demand than most other countries is the sheer volume of data being transferred across networks. The amount as well as rate of data traffic in the country is causing many users to switch from wireless networks to wired modes, thus increasing the consumption of PON equipment.

India has proposed to build what the country will call the National Optical Fiber Network. The NOFN is a part of a plan to enhance the connectivity between different villages across India. The resultant dark fiber network is expected to significantly improve the nation’s connectivity.

GPON Preferred More While EPON Developments Enable Better Adoption

By the end of 2023, gigabit passive optical networks are expected to hold 70.24% of the market over their counterpart structure, the Ethernet passive optical network. The key reasons for the higher implementation of GPON structure and equipment include the use of GPON encapsulation method, which helps service providers develop efficient subscriber packaging with their frames in segments. GPON also permits a more diverse array of bit rate options. They are, however, largely determined by the industry standards of a regions.

EPON structures, on the other hand, are proliferating at a rapid rate owing to backhaul carriage services that can be offered in 3G and 4G mobile technologies. Technological advancements are also allowing EPON structures to be completely compatible with the current Ethernet standards, which removes the need to modify speeds during connection. However, EPON structures are currently being limited in use due to the large-scale usage of GPON structures.

Key PON equipment providers in the world currently are Huawei Technologies Co., Ltd., ZTE Corporation, Alcatel-Lucent S.A., and Calix, Inc. They own large revenue shares of the market and are collectively creating a highly consolidated market.

Passive optical network (PON) is a fiber to the premises (FTTP) network structure. The goal of the network is to provide a solution which is easy to install, maintain and upgrade. This is done by using optical splitters in PON which enables a single fiber to deliver services to multiple premises. PON comprises an optical line terminal at the site of the service provider and numerous optical network units near end users. It is considered an eco-friendly alternative vis-à-vis conventional network, due to usage of unpowered optical splitters.

GPON devices provide high-speed video, data and voice services to residential and business subscribers. Reliability and long-reach connectivity further strengthens the extremely high bandwidth of GPON technology. It also reduces the number of active switching devices implemented in a computer network. Moreover, GPON has been a major advancement for defense services, primarily due to advanced security and high bandwidth provided by the network.

EPON assists service providers to deliver voice and IPTV services, broadband and enterprise services, such as voice and internet connectivity and time division multiplexing (TDM). In addition, 4G and 3G mobile backhaul carriage services are also provided by EPON. With advancement in technology, new EPON equipment having full compatibility with the existing Ethernet standards are being developed continuously. As Ethernet is the major networking solution used in local area networks (LANs) and metro-area networks (MANs), protocol conversions are not required.

ONT as well as OLT are used in both GPON and EPON. OLT is placed at the service provider's central site, while the ONT at the premises of end users. The OLT operates as the Local Area Network (LAN) - combination element for assimilating video, voice and data services into a particular fiber structure. The ONT provides different local service interfaces to the user, such as video, telemetry, voice and data. GPON offers secure, high bandwidth and scalable networks for military, business and campus applications by leveraging influence of fiber optics and internet protocol/Ethernet architecture.

This market research study analyzes the global passive optical network equipment market and provides estimates in terms of revenue (USD Billion) from 2014 to 2023. It recognizes the drivers and restraints affecting the industry and analyzes their impact over the forecasted period from 2015 to 2023. Moreover, it identifies the significant opportunities for market growth in the years to come.

The report segments the market based on components which includes optical cables, optical power splitters, optical filters and wavelength division multiplexer/de-multiplexer. The market has been bifurcated on the basis of structure into Ethernet passive optical network (EPON) and gigabit passive optical network (GPON). Furthermore, GPON and EPON have also been subdivided on the basis of components which include optical line terminal (OLT) and optical network terminal (ONT). The OLT and ONT segments have also been estimated on the basis of revenue in USD billion. In addition, the global PON market has been subdivided by geography into North America, Europe, Asia Pacific and rest of the world (RoW).

In order to ensure a clear understanding of the global passive optical network equipment market, we have given a detailed analysis of the value chain. Furthermore, the study comprises of a market attractiveness analysis, where the equipment are benchmarked based on their market scope, growth rate and general attractiveness.

The report provides company market share analysis of the various industry participants. Key players have also been profiled on the basis of company overview, financial overview, business strategies and key developments. Major market participants profiled in this report include Huawei Technologies Co. Ltd., Alcatel-Lucent S.A., ZTE Corp, Calix Inc., Ericsson Inc., Adtran Inc, Freescale Semiconductor Inc., Motorola Solutions Inc., Mitsubishi Electric Corporation and Verizon Communications Inc.

Global passive optical network (PON) equipment market: by components

  • Optical cables
  • Optical power splitters
  • Optical filters
  • Wavelength division multiplexer/de-multiplexer

Global passive optical network (PON) equipment market: by structure

  • Gigabit passive optical network (GPON)
  • Ethernet passive optical network (EPON)

Global gigabit passive optical network (GPON) equipment market: by components

  • Optical Network Terminal (ONT)
  • Optical Line Terminal (OLT)

Global Ethernet passive optical network (EPON) equipment market: by components

  • Optical Network Terminal (ONT)
  • Optical Line Terminal (OLT)

Global passive optical network (PON) equipment market: by geography

  • North America
    • U.S.
    • Canada
    • Mexico
  • Europe
    • U.K.
    • Germany
    • France
    • Italy
    • Rest of Europe
  • Asia Pacific
    • China
    • India
    • Rest of Asia Pacific
  • Rest of the World (RoW)
    • Latin America
    • Middle East
    • Africa