Optical Transport Network Market is Estimated to Witness High Growth Owing to the Growing Demand for Scalable and Flexible Network Connectivity
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| Optical Transport Network Market |
Optical Transport Network (OTN) refers to a protocol that enables the transmission of data over optical media. OTN offers greater flexibility and higher data rates than conventional transport networks. It is used for transferring multiple client signals in an optical fiber network using a method called multiplexing. OTN uses an optical carrier to transmit raw bits of data to the transport level in synchronous optical networking (SONET) or synchronous digital hierarchy (SDH) over long distances and different network topologies.
The global
optical transport network market is estimated to be valued at US$ 22.32 Bn in
2023 and is expected to exhibit a CAGR of 5.8% over the forecast period
2023-2030, as highlighted in a new report published by Coherent Market
Insights.
Market Opportunity:
The growing demand for scalable and flexible network connectivity is the major
opportunity for the optical transport network market. With increasing data
traffic over fixed and mobile networks, there is a need for networks that can
scale bandwidth as per demand. OTN offers flexibility to handle the surge in
traffic by dynamically allocating bandwidth. It allows flexible mapping of any
client signal into containers called Optical channel Data Units (ODUs). This
makes OTN future-proof and helps in seamlessly upgrading network bandwidth. The
ability of OTN to provide scalable and flexible connectivity is leading to its
increasing adoption for 5G backhaul, data center connectivity and metro/long
haul networks. This rising demand for scalable bandwidth is expected to drive
growth in the optical transport network market over the forecast period.
Porter's Analysis
Threat of new entrants: Low due to the requirement of high capital investments
to build optical fiber infrastructure and compete with existing major players.
Bargaining power of buyers: Moderate as buyers have bargaining power due to the
presence of several vendors, however, switching costs associated with migrating
to different vendors provide stability to existing players.
Bargaining power of suppliers: Low due to the presence of many component and
solution suppliers such as Solvay SA, Nippon Chemical Industrial Co. Ltd. in
the market.
Threat of new substitutes: Low as there are limited alternatives available for
high-speed, large network connectivity requirements.
Competitive rivalry: High due to the presence of key players like Solvay SA,
Nippon Chemical Industrial Co. Ltd. competing on performance specifications,
reliability, and pricing.
SWOT Analysis
Strengths: Growing need for high-speed fiber connectivity. Large untapped
market potential in developing regions.
Weaknesses: High initial investments requirements. Technological complexities
involved.
Opportunities: Emerging applications of 5G, IoT, and cloud-based services.
Government initiatives for digital infra evolution.
Threats: Cyclical nature of capital investments. Delays in infra upgrades.
Interoperability issues.
Key Takeaways
Global
Optical Transport Network Market is expected to witness high growth
over the forecast period of 2023 to 2030.
Asia Pacific region is expected to dominate the market
during the forecast period attributed to increasing investments towards digital
transformation initiatives, 5G deployment, and fiber connectivity projects in
countries like China and India.
Key players operating in the Optical Transport Network market are Solvay SA,
Nippon Chemical Industrial Co., Ltd., Hubei Xingfa Chemicals Group Co., Ltd.,
Sigma-Aldrich (Merck KGaA), LANXESS AG.
Regional analysis of the Asia Pacific Optical Transport Network market
comprises about 60% of the global market share in 2023. China is projected to
lead the Asia Pacific Optical Transport Network market growth during the
forecast period backed by increasing 5G infrastructure deployment projects and
focus towards rural connectivity by the government.
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