Active Optical Cable Market Forecast to Reach $2624.27 Million by 2025

Global Active Optical Cable Market is forecast to reach $2624.27 million by 2025, growing at a CAGR of 18.47% during the forecast period 2020-2025. Active Optical Cables refer to a cabling technology which utilizes optical fiber for improving the speed and distance performance of the cables between the connectors. Due to the compact and lightweight designs of these cables, they have been able to gain high popularity across various industries including telecom, data centers, aerospace and defense with many others as compared to traditional copper-based cables. Increasing demand for active optical cables across data centers as well as adoption of optical fiber communication networks within the telecommunication industry are some major factors driving the demand for active optical cables. Moreover, requirement of high-speed data connectivity across audio or video devices, online gaming and many others are also creating a positive impact on the growth of active optical cable market.

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Active Optical Cable Market Segment Analysis - By Protocol

Ethernet segment held the major share of $344.57 million in the global active optical cable market during 2019 and will have significant growth of CAGR 17.75% during the forecast period 2020-2025. Active optical cables based on Ethernet protocols are getting highly deployed by various end users mainly due to features such as offering virtualized connectivity and minimized errors within switch to switch, server to switch and many other high-speed storage applications with cost efficiency, thus propelling the market demand towards Ethernet based optical cables. Moreover, these optical cables are capable of offering high EMI resistivity, which makes it ideal choice for various end-use applications within harsh industrial environments. Since these optical cables are ruggedized in nature, they are getting high adoptability across applications such as high-speed control and data systems, aircraft system ground stations, avionics system controls, and others. Such factors will eventually help in propelling high market demands towards Ethernet optical cables in the long run.

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Active Optical Cable Market Segment Analysis - By Application

Consumer Electronics is the fastest growing segment in the global active optical cable market and is estimated to grow at a CAGR of 19.90% over the forecast period 2020-2025. Active optical cables are used in various consumer applications including audio, video as well as network connectivity. Compared to copper cables used earlier, active optical cables offer benefits such as low power consumption, easy installation and many others, thus helping it to expand its usage across consumer electronics markets. Moreover, miniaturization and connectivity trends within consumer electronics sector, had created high demand towards lightweight and thinner designed active optical cables. Such factors have been creating major deployment across consumer devices such as gaming consoles, HDTV and others, thus anticipated to create more demands in the active optical cable market. With the growing demand towards high-end AV applications, the need for efficient cabling solutions which can offer high-quality video resolution displays is also rising significantly within the consumer industry vertical. Adoption of active optical cables has been rising across consumer electronics sector owing to its capability of delivering high dynamic range videos with expansive contrast ratio as well as colour accuracy with the content protection support. Such factors are further set to create a positive impact on the growth of active optical cables within the consumer electronics industry over the forecast period.

Active Optical Cable Market Segment Analysis - By Geography

Asia-Pacific had dominated the global active optical cable market with a major share of $361.22 million during 2019 and is expected to witness a significant market growth with CAGR of 20.21% during the forecast period 2020-2025. High investments towards research and development activities along with the rising growth of consumer electronics sector have been fuelling the growth for active optical cable market in this region. Moreover, governmental initiatives towards boosting the growth of telecom industry along with technological advancements such as cloud, IoT and many others are also anticipated to propel more demands in the active optical cable market over the forecast period. As a part of National Broadband Mission, the Indian Government had announced of investing about $100 million in 2019, as an initiative towards providing universal broadband to the rural and remote villages by the year 2022. This investment helped in facilitating equitable access to broadband services through setting up an incremental 30 lakh route km of optical fiber cables with increasing the tower density. Such factors are further set to create more demand for active optical cables in the near future.

Active Optical Cable Market Drivers

Growing adoption of optical fiber communication networks by telecom industry

The rising adoption of telecom sector towards optical fiber communication networks has been acting as one of the major drivers towards causing significant market growth of active optical cables. Due to high penetration of the Internet, electronic commerce, multi-media and others, the information traffic is getting affected, thus creating need for fiber optics technology for meeting large bandwidth requirements for the telecom sector. Telecom operators have been highly adopting such cables to optimize data transmission rates, while ensuring high bandwidth support. Deployment of active optical cables help the telecom service providers to improve data connectivity standards as well maintain a wide network coverage for its end use customers, thus driving its industrial growth. Growing technological advancements across the telecom industry has been also boosting the rise of fiber optics networks due to incorporating various demanding and popular broadband network architectures such as Fiber to the Home, Fiber to the building and many others, thus causing a positive impact on the growth of active optical cables.

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Active Optical Cable Market Challenges

Requirement of high investments

High investments related to manufacturing, maintenance and repair is acting as a major challenge towards hampering the market growth of active optical cables. Since the active optical cables are much thinner and light weight compared to copper based cables, there is high susceptibility towards industrial damages owing to continuous usage, thus causing high amount of wear and tear. In order to continue with the industrial work operations, manufacturers need to spend high amounts for rewiring or renovations, thus adding to its high maintenance and repair costs. Additionally, manufacturing costs of these optical cables are comparatively higher due to usage of expensive active components, thus adversely impacting its market growth. High compatibility with various types of costly connectors, to offer optimum network connectivity across applications including high performance computing, consumer devices and others, has caused the manufacturers to increase the purchasing costs of these cables, which is ultimately slowing down the growth of active optical cable market.

Active Optical Cable Market Landscape

Partnerships and acquisitions along with product launches are the key strategies of the players in the Active Optical Cable Market. The major key players in the Active Optical Cable Market include Gigalight, Amphenol Corporation, Mellanox Technologies, 3M, Finisar/II-VI Inc., Molex LLC, Cisco Systems Inc., Broadcom Inc., Hisense and Samtec.

Partnerships/Product Launches/Acquisition

In June 2020, Black Box had launched a new family of networking active optical cables as a part of offering optimizing data center as well as edge network applications. These cables will help in addressing the rising demand for cloud services, big data storage as well as media streaming with offering support for SFP, SFP+, QSFP and QSFP+. Moreover, with integrated SFP/QFSP transceivers, these optical cables will help in significantly reducing the costs and complexities related to fiver installation along with overcoming the requirement of time-consuming and costly testing using modular transceivers.

In July 2020, Cosemi Technologies Inc. had announced of expanding its retail distribution channels for the hybrid active optical cables portfolio. With this expansion, the company will enlarge its global footprint by making the availability of HDMI, USB as well as Display Port active optical cables across Newegg, Amazon Japan and Singapore.

Key Takeaways

Ethernet active optical cables is expected to have a major market share during the forecast period 2020-2025 owing to its cost efficiency along with growing demands across data centers and consumer electronics sector.

Consumer Electronics sector is anticipated to register high market growth in the global active optical cable during the forecast period 2020-2025 owing to its wide adoption across consumer applications including audio or video systems, HDTVs, computers and many others.

High investments in research and development activities along with rising growth of telecom and consumer electronics sectors have been the major factors driving the need for active optical cables within APAC region.

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