PUBLISHER: Market Xcel - Markets and Data | PRODUCT CODE: 1516946
PUBLISHER: Market Xcel - Markets and Data | PRODUCT CODE: 1516946
Global photonic integrated circuit market size was valued at USD 12.30 billion in 2023, and is expected to reach USD 41.17 billion in 2031, with a CAGR of 16.30% for the forecast period between 2024 and 2031. The advancements in optical communication, sensing, and emerging technologies are a prominent factor behind the photonic integrated circuit (PIC) market growth. The expansion of 5G networks has resulted in the ever-growing demand for fast data transmission and the use of connected devices such as photonic integrated circuits are used for biosensing and diagnostics in healthcare. Integration of photonic integrated circuits into quantum computing is also observed to be a noticeable growth factor. Another key factor behind the growth factor is the use of silicon photonics and widespread adoption in the diverse sectors such as telecommunications, healthcare, and aerospace highlight the adaptability of photonic integrated circuit. The ongoing research and development contribute continuous advancement in the field of photonic integrated circuit market, making it an important factor in the future scope of integrated photonics.
The photonic integrated circuit market is witnessing a continuous growth with the expansion in the 5G networks globally which is contributed by the requirement of fast and reliable data transmission around the world. Photonics integrated circuits are crucial to meet the demands of high-frequency and data-intensive 5G communication by ensuring efficient transmission of optical signals. Photonic integrated circuits have proved to be important in the evolving 5G infrastructure due to their ability to integrate seamlessly and enhance overall performance. It offers increased bandwidth and data rates to meet the advanced capabilities of the next generation of wireless communication. Therefore, the future of telecommunication systems is observed to be dependent on the technological advancement of photonic integrated circuit market.
For instance, in September 2023, Infinera and Sumitomo Electric Industries, Ltd. introduced the capabilities of the Infinera's ICE-X intelligent coherent pluggable optics to deliver high-speed commercial services over Sumitomo Electric's passive optical network (PON) infrastructure. The demonstration is related to the development and use of photonic integrated circuits enabling high-speed optical communication networks.
Development of Healthcare Applications Promoting the Global Photonic Integrated Circuits Market Growth
The pivotal role of photonic integrated circuit in biosensing, diagnostics, and medical imaging and other healthcare applications is contributing to the photonic integrated circuit market growth with the increasing utilization as it offers fast and precise data transmission in optical communications, improving the overall efficiency of healthcare related devices. For instance, photonic integrated circuits allow real-time monitoring of biological signals with heightened sensitivity in the field of biosensing, contributing to global photonics integrated circuits market share. Photonics integrated circuits are incorporated in the medical imaging systems ensuring improved resolution and diagnostic precision. It witnesses a rise in demand, owing to its capability to provide high-performance solutions among various applications as the healthcare industry relies heavily on advanced technologies. The growing combined effect of photonic integrated circuit and healthcare applications proves that photonic integrated circuits are crucial in advancing healthcare devices, fostering revenue generation in the healthcare industry.
For instance, in May 2023, Etteplan designed an innovative strategy to speed up the worldwide breakthrough in photonics which showed that the feasibility of modular machine platform can result in lightning-fast construction of optical components with great precision. Prototypes of photonics devices can be made considerably and quickly, owing to the recent advancements.
Need for Better Data Center Connectivity Fueling the Growth of Market
The data centers are evolving to cater to the increasing data traffic and photonic integrated circuits, observed to be important in the development of data centers. Photonic integrated circuits are observed to be crucial as they offer efficient data processing subsequently helping to reduce latency and improve overall performance. It is observed that the widespread adoption of photonic integrated circuits in the data centers to meet the demands of advanced applications and services with the rising importance of efficiency and scalability in data centers is crucial. The increasing reliance on photonic integrated circuits is justifying it as a key component for the growing data center connectivity. Thus, the global photonic integrated circuit market trend with the increasing demand for sustainable and efficient data center connectivity contributes to the market growth.
For instance, in August 2023, IONOS, the most prominent web-hosting company in Europe, expanded its network to provide stable, high-capacity, high performance connectivity services to data centers across Europe by incorporating Infinera's GX Series Compact Modular Platform. It allows the organization to increase its capacity and supply 100 GbE and 400 GbE services while fulfilling the increasing demand for connectivity of data centers.
Aerospace and Defense Sector Drives the Photonic Integrated Circuit Market
The advancement in the field of photonic integrated circuits has increased the utilization in aerospace and defense applications substantially contributing to the growth of the global photonic integrated circuit market share. Precision, consistency, and speed are vital in the domain of aerospace and defense as they play a crucial role in improving communication and sensing systems. Photonic integrated circuits allow the transmission of optical signals rapidly and accurately to support the advanced communication technology used in aerospace and defense operations. Furthermore, it enhances sensing capabilities, enabling the development of sophisticated sensing systems for reconnaissance and surveillance. The implementation of photonic integrated circuit is growing with the advancement in the domain of aerospace to meet the requirement by integrating cutting-edge technologies, establishing it as key component for attaining enhanced sensing and communication capabilities, contributing to the global photonic integrated circuit market growth.
For instance, in January 2023, The M30 Reference Design, a complete software-defined sensor implementation to enable rapid adoption of LCM-based solid-state beam steering technology, was announced jointly by Lumotive and Lumentum Holdings Inc.
Asia-Pacific Dominates Global Photonic Integrated Circuit Market
Asia-Pacific is maintaining its dominance in the global photonic integrated circuit market share as it has robust semiconductor industry. Particularly countries such as China, Japan, and South Korea are continuously contributing to the manufacturing and innovation of photonic integrated circuits. The expansion of sectors such as telecommunication, data centers, and consumer electronics in Asia-Pacific is propelling the adoption of photonic integrated circuits. The businesses are continuously making strategic investments in research and development, combined with supportive government initiatives, which helps in positioning Asia-Pacific as a key player in shaping the future of photonics integrated circuits. The region leads in PIC deployment with a dynamic ecosystem of technology companies and a focus on emerging applications contributing substantially to the photonic integrated circuit market's overall growth and influence.
For instance, in March 2023, Infinera, which has its presence in Asia-Pacific launched the technological upgrade of their industry-leading GX Series Compact Modular Platform Solution, which incorporates the next-generation high-performance 1.2 Tb/s ICE7 optical engine along with multi-haul optical line system. The GX platform and ICE7 optical engine allows network operators to meet the requirements of swiftly increasing bandwidth. It provides separate services to their customers by demonstrating the potential of photonic integrated circuits in enabling high-speed and reliable connectivity solutions.
Government Initiatives to Foster Global Photonic Integrated Circuit Market Revenue Growth
Government initiatives play a pivotal role in fostering revenue growth in the photonic integrated circuit market. Various countries are strategically investing in research and development programs, offering grants, and facilitating collaborations to boost the photonic integrated circuit market. For instance, initiatives supporting the development of optical communication technologies and integrated photonics contribute to industry advancements. Government-backed projects in telecommunications, defense, and healthcare sectors further drive PIC innovation and adoption. Additionally, financial incentives, tax rebates, and supportive policies encourage companies to invest in PIC technologies. The alignment of governmental efforts with the specific needs of the photonic integrated circuit market creates a conducive environment for growth, driving technological advancements, job creation, and overall revenue expansion.
For instance, in October 2023, the Ministry of Electronics and Information Technology (MeitY), India inaugurated the silicon photonics research center. The Center, named Silicon Photonics CoE-CPPICS, aims for self-sufficiency in five years, focusing on product commercialization through start-ups. With a pivotal role in advanced technologies such as quantum computing, 5G/6G, and artificial intelligence, the center, funded by MeitY, aligns with the ambitious goals of India Semiconductor Mission, addressing gaps and promoting indigenous photonic integrated circuit manufacturing.
Future Market Scenario (2024-2031F)
The future of the photonic integrated circuit market is poised for sustained growth with ongoing advancements in PIC technology. It includes innovations in material science, design methodologies, and manufacturing processes, contributing to improved performance and efficiency.
Anticipated growth in emerging applications, such as quantum computing, LiDAR systems, and biomedical imaging, will be a significant driver. The demand for advanced PICs tailored to their specific requirements is expected to rise as these fields evolve.
The expansion of 5G networks and the subsequent evolution to future wireless communication standards will continue to fuel the growth of the photonic integrated circuit market. Their role in enabling high-speed data transmission and efficient optical communication is vital for next-generation communication networks.
Key Players Landscape and Outlook
The global photonic integrated circuit market is highly competitive, with prominent manufacturers dominating the market share. These industrial giants have a significant impact on altering the market landscape, fostering innovation, and influencing technical breakthroughs. Their manufacturing experience in photonic integrated circuits, research capabilities, and strategic alliances have a substantial effect on market dynamics. The competitiveness among these major corporations drives innovation and assures that the photonic integrated circuit market is developing and expanding during the forecast period.
For instance, in July 2023, Cloud Light was acquired by Lumentum for approximately USD 750 million. The highly complementary combination solidifies Lumentum's position as a pioneer in supplying photonics to cloud operators, allowing the company to expand more than fivefold its serviced potential of the data centers.
All segments will be provided for all regions and countries covered
Companies mentioned above DO NOT hold any order as per market share and can be changed as per information available during research work.