PUBLISHER: Stratistics Market Research Consulting | PRODUCT CODE: 1476342
PUBLISHER: Stratistics Market Research Consulting | PRODUCT CODE: 1476342
According to Stratistics MRC, the Global Fiber Optic Preform Market is accounted for $6.38 billion in 2023 and is expected to reach $25.37 billion by 2030 growing at a CAGR of 21.8% during the forecast period. Fiber optic preform is the building block of fiber optic cables; it is where their manufacturing process begins. It is a finely engineered cylinder meant to be drawn into thin, flexible fibers made of high-purity silica or other materials. The thin strands that transmit data via light pulses are created during manufacture by heating and stretching the preform. For the purpose of minimizing signal loss and maximizing the efficiency of data transmission, its purity and precise geometry are essential. Moreover, fiber-optic devices are the unsung heroes of our networked world, allowing data to be reliably and quickly transferred over great distances.
According to the Fiber Optic Association (FOA), fiber optics is a key technology that enables high-speed data transmission and forms the backbone of modern communication networks.
Growing need for high-speed internet accessibility
The fiber optics market is largely driven by the exponential rise in data consumption, which is creating an increasing need for high-speed internet connectivity. Both consumers and businesses need faster and more dependable internet connections due to the rise of streaming services, cloud computing, online gaming, and Internet of Things devices. When it comes to data transmission speeds, fiber optic cables, which are composed of fiber optic preforms, offer a substantial increase in bandwidth over conventional copper cables. Additionally, there is a sharp increase in the market for fiber optic preforms needed to produce these high-capacity cables that can fulfill the ever-increasing demands of data-intensive applications.
High requirement for technical expertise and initial investment
The high initial cost of setting up manufacturing facilities is one of the main barriers to the market for fiber optic preforms. High-quality fiber optic preform production requires specialized manufacturing techniques and advanced machinery, both of which require large capital investments. Furthermore, the fabrication of fiber optic preforms necessitates a high degree of technical proficiency and strict quality control procedures to guarantee consistency, purity, and uniformity in the preform's geometry and composition. These capital and skill requirements make the market relatively difficult for new players to enter, which may limit the market's potential for growth.
Development of fiber-to-the-home (FTTH) networks
The market for fiber optic performance is expected to benefit from the growth of fiber-to-the-home (FTTH) and fiber-to-the-premises (FTTP) networks. Compared to conventional copper-based networks, fiber-to-the-home (FTTH) networks offer better performance and dependability and provide high-speed broadband internet directly to residential and commercial buildings. Moreover, fiber optic preforms are expected to become increasingly in demand as manufacturers of fiber optic cables used in FTTH networks look to governments and telecom operators to prioritize the deployment of these networks in order to close the digital divide and meet the growing demand for broadband connectivity.
Strong rivalry and pricing pressure
The fierce rivalry between suppliers and manufacturers is one of the main risks facing the fiber optic performance market. There are many competitors vying for market share in this market, which puts pressure on prices and erodes margins. Particularly in areas with oversupply or fierce competition, manufacturers frequently compete on price to win contracts and stay relevant in the market. Furthermore, the existence of low-cost producers, particularly in areas with cheaper labor and production costs, heightens price competition and jeopardizes the profitability of established firms. Businesses in the fiber optic performance industry need to concentrate on innovation, operational effectiveness, and product differentiation in order to reduce this threat and maintain margins.
The market for fiber optic products has been impacted by the COVID-19 pandemic. While lockdowns and restrictions during the pandemic's early stages caused disruptions to supply chains, manufacturing processes, and project implementations, the rise in remote work, online education, and digitalization initiatives later in the year increased demand for high-speed internet connectivity and accelerated the adoption of fiber optic technology. A strong telecommunications infrastructure is essential, as demonstrated by the growing reliance on digital communication and data transmission. This has led to investments in fiber optic networks and increased demand for fiber optic preforms. However, persistent issues like labor shortages, supply chain bottlenecks, and economic uncertainty still present difficulties for market participants.
The Single-Mode segment is expected to be the largest during the forecast period
In the market for fiber optic products, the single-mode segment usually has the largest share. In contrast to multi-mode fibers, single-mode fiber optic preforms are made to transmit a single mode of light, allowing for greater bandwidth and longer transmission distances. Low signal attenuation and high data transmission rates are critical in long-haul telecommunications networks, data centers, and high-speed internet connections, where they are widely used. Moreover, single-mode fiber technology's dominance in the fiber optic performance market is further supported by developments in the field, including decreased signal loss and increased data capacity.
The Modified Chemical Vapor Deposition (MCVD) segment is expected to have the highest CAGR during the forecast period
The Modified Chemical Vapor Deposition (MCVD) segment usually shows the highest CAGR. MCVD is a widely used process that is renowned for its adaptability and capacity to create superior preforms with exact control over dopants and composition. Chemicals that have been vaporized are deposited onto a revolving silica tube, enabling the creation of complex core-clad structures that are suited to particular optical needs. The popularity of MCVD can be attributed to its capacity to generate preforms for single-mode and multi-mode fibers, meeting the needs of various applications in sensing, data transmission, and telecommunication. Furthermore, continuous developments in MCVD technology, such as better deposition methods and increased process automation, support the technology's expanding market and increasing adoption.
In the fiber optic preform market, the Asia-Pacific area usually holds the largest share. Numerous factors, such as the region's rapidly growing telecommunications industry, fast urbanization, rising internet penetration, and the existence of major market players and manufacturing hubs, are responsible for this dominance. Strong investments in telecommunications infrastructure and ongoing technological advancements are driving demand for high-quality preforms, and countries like China, Japan, South Korea, and Taiwan are major players in the fiber optic preform market. Additionally, the Asia Pacific market is growing due to the increasing use of fiber optic technology across a range of industries, including healthcare, automotive, aerospace, IT, and telecommunications.
In the fiber optic preform market, the Middle East and Africa region usually shows the highest CAGR. Numerous factors are driving this growth, such as rising demand for high-speed internet connectivity, increased investments in telecommunications infrastructure, and ongoing efforts to transform various industries through digital means. Strong telecommunications networks are required to support digitalization efforts in the Middle East and Africa region due to the region's fast urbanization, population growth, and expanding economies. Moreover, the region's growing need for fiber optic preforms is also fueled by initiatives like government-led broadband expansion programs and Smart City projects.
Key players in the market
Some of the key players in Fiber Optic Preform market include Prysmian Group, Optical Cable Corporation, Sterlite Technologies Limited, Fujikura Ltd., Corning Incorporated, Yangtze Optical Fibre and Cable Joint Stock Limited Company, Hengtong Group Co.,Ltd, Shin-Etsu Chemical Co., Ltd., OFS Fitel, LLC, Furukawa Electric Co., Ltd., Heraeus Holding, Sumitomo Electric Industries, Ltd., Finolex Cables Limited and Jiangsu Zhongtian Technology Co., Ltd.
In December 2023, Prysmian Group, world leader in the energy and telecom cable systems industry, signed a Service Level Agreement (SLA) with the German-Dutch transmission system operator TenneT to provide nearshore and offshore cable inspection, maintenance and repair services for TenneT's HVDC and HVAC submarine power cables in the North Sea.
In October 2023, Sterlite Technologies Ltd (STL), a leading optical and digital solutions company, on Wednesday announced that it has collaborated with Hygenco, a homegrown green hydrogen solutions provider, for the supply of Green Hydrogen to its manufacturing plants, the company announced through an exchange filing.
In June 2023, Corning Incorporated and SGD Pharma today announced a joint venture that includes the opening of a new glass tubing facility to expand pharmaceutical manufacturing in India and allows SGD Pharma to adopt Corning's Velocity Vial technology platform.