Active Optical Cable Market to Reach $12.60 Billion By 2028

According to a recent report published by Allied Market Research, titled, “Active Optical Cable Market By Technology, Connector Type, and Application: Opportunity Analysis and Industry Forecast, 2021–2028,” the global active optical cable market size was valued at $1.63 Billion in 2019, and is projected to reach $12.60 Billion by 2028, growing at a CAGR of 27.5% from 2021 to 2028. 

The global active optical cable market growth is primarily driven by a growth in the demand for active optical cables in data centers and an increase in the demand of high bandwidth networks. Cloud-based applications, audio and video services, online gaming, and CATV require high-speed data services, which are facilitated by the use of active optical cables (AOCs). These cables are primarily used in data centers and high performance computing. 

However, with increase in requirement of efficient transfer of high-speed data, these cables are now being increasingly used in applications encompassing personal computer, digital signage, and consumer electronics. Governments across the globe are investing in AOC cable to improve their network connectivity. However, the high initial investment and the threat of replacement from copper cables and wireless broadband limits the growth of this market. However, the advancement in the fiber optics technology provides numerous opportunities for the market growth.

According to global active optical cable market analysis, CDFP is the fastest growing connector, registering a CAGR of 34.2% during the forecast period. However, QSFP is the highest revenue-generating segment and accounted for $678.3 million in 2019.  

Active optical cables are used in data centers, high performance computing, personal computers, digital signage, consumer electronics, and others. In year 2019, data centers contributed the highest revenue share, accounting for around 47.3% of the overall market revenue. 

This segment is expected to maintain its dominant position throughout the forecast period. From a growth perspective, digital signage is likely to be the most prominent application of active optical cable, and is anticipated to witness the highest CAGR of 30.8% during the forecast period. This is attributed to an increase in the requirement for higher bandwidth, for multiple, uncompressed video streams. 

Based on region, the market is analyzed across North America, Europe, Asia-Pacific, and LAMEA. According to global active optical cable market trends, North America was the highest revenue-generating region, valued at $656.2 million in 2019. 

This region is further expected to attain a market value of $4,451.8 million by 2028, growing at a CAGR of 25.7%. The market in Asia-Pacific is in the growth phase and is the fastest growing region for the global active optical cable market. This is mainly attributed to increase in number of data centers and the developing infrastructure in this region.  On the other hand, LAMEA is in the introductory phase in terms of adoption of active optical cables.

COVID-19 Impact Analysis

COVID-19 has caused the overall semiconductor industry to mobilize quickly and to make short-term decisions with long-term implications. Semiconductor companies operate in a complex ecosystem, working across the value chain with numerous raw materials, assembly, test, package, and equipment suppliers and partners, globally. 

The demand from the wireless communication segment is expected to increase due to factors such as increased broadband usage, higher demand for cloud services, and video streaming. In addition, in the medium to long term, COVID-19 is expected to further drive the need for digital transformation, technologies such as 5G, the IoT, AI, and intelligent edge computing for future optimization.

The end users of active optical cables represent mixed trends during the COVID-19 pandemic. Industry verticals such as transportation, construction, and others show minimal demand. However, the demand from defense sector, power plants, oil & refineries remained unaffected. Besides, quality check and maintenance of products, components, or structures is of utmost importance for every industry. As a result, the budget is most likely to remain unaffected even in the times of pandemic. 

Key Findings Of The Study

• By technology, the infiniband segment generated the highest revenue in the global active optical cable market forecast in 2019.
• By connector type, the QSFP segment generated the highest revenue in the global active optical cable market forecast in 2019.
• By application, the data center segment generated the highest revenue in the global active optical cable market forecast in 2019.

The key players profiled in this report include 3M Company, Amphenol Corporation, Avago Technologies Limited, Finisar Technologies, Fujitsu Limited, IBM, Lumentum Holdings Inc., Molex LLC, Siemon Company, and Sumitomo Electric Industries Ltd. These key players adopt several strategies such as new product launch & development, acquisition, partnership & collaboration, and business expansion to increase the active optical cable market share during the forecast period.