Status : Published Published On : Apr, 2022 Report Code : VRSME9119 Industry : Semiconductor & Electronics Available Format : Page : 250
2022
2028

Global Silicon Photonics Market – Analysis and Forecast (2021-2027)
Industry Insight by Product (Transceiver, Variable Optical Attenuator, Switch, Cable, and Sensor), by Component (Active Component (Laser, Optical Modulators, Photodetectors, and Others), and Passive Component (Optical Waveguide, Splitters, and Isolators)), by Application (Data Center & High-Performance Computing, Telecommunication, Military, Defense, and Aerospace, Medical and Life Sciences, and Sensing), and Geography (U.S., Canada, Germany, U.K., France, China, Japan, India, and Rest of the World)

Industry Overview

Silicon Photonics is an emerging field of research that uses photonic systems to process, transform, generate, and transmit data more quickly within computer chips. Silicon Photonics is growing at a healthy rate since it is less expensive and uses less energy. From USD 1.3 billion in 2021, the global silicon photonics market size is anticipated to grow to USD 4.8 billion by 2027, witnessing a CAGR of 26.9% during the forecast period 2021-2027.  Silicon photonic waveguides, silicon optical modulators, silicon optical interconnects, silicon LEDs, and silicon photodetectors are some of the products in the market. Furthermore, the extensive adoption of silicon photonics in several industries like healthcare, military & defense, and metrology will propel the growth of the market.

Silicon Photonics Market Highlights

The COVID-19 pandemic has had an impact on almost all industries globally owing to stringent lockdown measures and social distancing norms so as to curtail the spread of coronavirus. Also, the economic crisis that followed the epidemic could cause a major delay in the commercial roll-out of networking components, causing significant disruption in the supply chain. There was a decline in income of small and medium-sized businesses which are considered to be the backbone of the technological industry. Thus, industry players are facing several limitations in the supply chain.

Market Segmentation

Insight by Product

On the basis of product, the global silicon photonics market is segregated into transceiver, variable optical attenuator, switch, cable, and sensor. The transceiver category dominates the silicon photonics market owing to its compact form, delivers high-speed performance in an optical communication system, and offers low power consumption capability.

Insight by Component

On the basis of component, the global silicon photonics market is bifurcated into active components and passive components. The passive component is further divided into the optical waveguide, splitters, and isolators. The active component is further divided into the laser, optical modulators, photodetectors, and others. The laser segment is anticipated to contribute the largest share in the market owing to advancements in hybris silicon and tunable lasers. The market players can develop electrically powered lasers on a Silicon wafer that can be integrated with other photonic devices using a hybrid technique. This will expand their usage in numerous data centers and telecommunication applications, allowing countries like the United States, the United Kingdom, and France to increase network capacity. Companies are also embracing tunable lasers that use high-performance silicon photonics to meet the demanding needs of next-generation coherent optics. Compact tunable lasers also promise exceptional performance in developing applications like biomedical OCT and autonomous car LiDAR.

Insight by Application

The global photonics market is divided into several categories based on application: data center & high-performance computing, telecommunication, military, defense, and aerospace, medical and life sciences, and sensing. Data Center and high-performance computing category is anticipated to hold the largest share in the market owing to the rising data center traffic, the surge in requirement of increased energy-efficient transmission, increased bandwidth capacity, and mounting volume of the global network will fuel the growth of the segment.

Silicon Photonics Market Report Coverage

Report Metric

Details

Historical Period

2015–2020

Base Year Considered

2021

Forecast Period

2021-2027

Market Size in 2021

$1.3 Billion

Revenue Forecast in 2027

$4.8 Billion

Growth Rate

CAGR 26.9%

Segments Covered in the Report

By Product, By Component, and By Application

Report Scope

Market Trends, Drivers, and Restraints; Revenue Estimation and Forecast; Segmentation Analysis; Impact of COVID-19; Companies’ Strategic Developments; Market Share Analysis of Key Players; Company Profiling

Regions Covered in the Report

North America, Europe, Asia-Pacific, Middle East, and Rest of the World

 

Industry Dynamics

Industry Trends

Silicon photonics has propelled the growth of big data analytics and cloud computing to their maximum potential by avoiding data traffic congestion in a wide range of communications and computing applications. Furthermore, the advent of novel technologies like the Internet of Things (IoT), artificial intelligence (AI), augmented reality/ virtual reality (AR/VR), consumer-generated video, connected devices, cloud computing, and other high-performance computing applications have sparked the need for high data transfer capabilities to accumulate, manage, store, and access rapidly growing unstructured data. In addition, the development of "Industry 4.0" has aided the development of industrial automation owing to factors like decreasing robotics prices, readily-available skills, ease of integration, and new capabilities.

Furthermore, with the rapid spread of COVID-19 in 2020, due to the increased adoption of work-from-home culture and increased e-learning activities, there has been a growing market for high-speed internet services. These data-intensive applications have increased the demand for high-speed broadband services, which in turn has increased the demand for silicon photonics technology.

Growth Drivers

Factors attributing to the growth of the global photonics market include mounting demand for increased bandwidth, rising demand for high-speed broadband services, and increased data transfer capabilities. Furthermore, the surge in the adoption of automated manufacturing practices and advancements in silicon photonics technology will accelerate the growth of the industry. Several benefits associated with silicon photonics include reduced operating cost, lower environmental footprint, less heating of components, increased integration, increased reliability, reduced error rate, and high spectral efficacy.

With the increased demand for new safety technologies like optimum vision in automobiles, silicon photonics technology is also making its way into the automotive sector. Market leaders are constantly concentrating on integrating novel technologies into LiDAR chips in order to expand their automotive business potential.

Challenges

The increased risk of thermal effect, implantation of silicon photonics components  in small circuits, unproductive electroluminescence of bulky crystalline silicon, and complexity in integration of on-chip laser will pose challenge in the growth of silicon photonics market. Future developments, such as the vertical-cavity surface-emitting laser (VCSEL), are expected to limit the market's growth. Furthermore, the market is challenged with severe hurdles like high market volume and technical mismatches, both of which are anticipated to stymie the silicon photonics Market's growth.

Opportunities

The increased deployment of 5G networks and rising demand in telecom and data communication will create tremendous opportunities in the global silicon photonics market due to rapid security offerings which can be customized. Also, the surging demand for active optical cables, optical attenuators, optical multiplexers will create massive opportunities in the global silicon photonics market outlook.

Geographic Overview

North America contributes the largest share in the silicon photonics market owing to its well-established telecom infrastructure, increased demand for high-performance, reduced cost, and customized components in life sciences, telecommunication, etc. will bolster the growth in the region.

Asia Pacific is anticipated to have the fastest growth in the silicon photonics market owing to the rising number of 5G deployment projects, massive investment in R&D activities of the telecom industry, and favorable initiatives by the government.

Competitive Insight

The market players are emphasizing innovations and R&D activities to have a competitive edge in the market. Furthermore, the industry players are entering into M&A, joint ventures, and partnerships along with developing a new product line, innovating existing products, and expanding their customer base in emerging economies so as to sustain themselves in the silicon photonics market.

Intel, one of the prominent leaders in silicon photonics, enables future data center bandwidth growth and next-generation 5G deployments with smaller form factors and greater speeds and is also introducing new optical integration platforms.  By eliminating networking inefficiencies that might result in stranded compute capacity, this novel solution lowers the total cost of ownership and improves the performance of data center systems. Silicon Photonics contributes by Providing software-configurable, high-bandwidth access to computation and storage,  and allows disaggregated data centers to use Software Defined Infrastructure (SDI)so as to decouple hardware and software resources.

Rockley is a leading developer and module supplier of integrated photonics chipsets, high-volume sensor, and communication systems. Light sources, active devices, passive devices, and optical coupling elements can all be integrated into a single silicon device using the Rockley development platform. Wearable devices with photonic integrated circuits (PICs) have lower costs, lower power consumption, and smaller sizes. Rockley Photonics is developing groundbreaking sensors in collaboration with VTT and bringing them to market.

In March 2022, NeoPhotonics Corporation, one of the prominent developers of silicon photonics and advanced hybrid photonic integrated circuit-based lasers, modules, and subsystems for bandwidth-intensive, high-speed communications networks, confirmed that it has demonstrated 120Gbaud operation in applications ranging from 800G LR transmission to 400G long haul transmission using its Indium Phosphide-based Coherent Receiver and Coherent Modulators, in combination with Distributed Feedback Lasers or Ultra-Narrow Linewidth Tunable Lasers.

In December 2021, The Intel® Research Center for Integrated Photonics for Data Center Interconnects was recently opened by Intel Labs. The objective of the center is to accelerate optical input/output (I/O) technological innovation in performance scaling and integration, with an emphasis on photonics technology and devices, CMOS circuits and link design, package integration, and fiber coupling. Intel Silicon Photonics Products include Intel® Silicon Photonics 100G PSM4 Optical Transceiver, Intel® Silicon Photonics 100G CWDM4 Optical Transceiver, Intel® Silicon Photonics 100G CWDM4 QSFP28 Optical Transceiver with Extended Temperature, Intel® 100G SR4 QSFP28 Optical Transceiver, etc.

Some of the industry players in the global silicon photonics market include Cisco Systems, Inc., Intel Corporation, NeoPhotonics Corporation, MACOM, STMicroelectronics, Rockley Photonics Ltd., SICOYA GMBH, Lumentum Operations LLC, Broadcom, and Hamamatsu Photonics K.K.

Region Covered in the Report

•    North America

- U.S.
- Canada
- Mexico

•    Europe

- Germany
- U.K.
- France
- Italy
- Spain
- Russia
- Rest of Europe

•    Asia-Pacific (APAC)

- China
- Japan
- India
- South Korea
- Rest of Asia-Pacific

•    Rest of the World (RoW)

- Brazil
- Saudi Arabia
- South Africa
- U.A.E.
- Other Countries

Frequently Asked Questions

From USD 1.3 billion in 2021, the global silicon photonics market size is anticipated to grow to USD 4.8 billion by 2027, witnessing a CAGR of 26.9% during the forecast period 2021-2027.
The industry players are entering into M&A, joint ventures, and partnerships along with developing a new product line, innovating existing products, and expanding their customer base in emerging economies so as to sustain themselves in the silicon photonics market.
The rising demand for silicon in photonics products at data centers to improve computational and processing capabilities, increased emphasis to reduce power consumption via silicon photonic transceivers, escalating need for high bandwidth, and mounting internet traffic will propel the market growth of the silicon photonics market.
Asia-Pacific is expected to be the fastest-growing region owing to the rising demand for high-speed internet networks and development of technological infrastructure in the region.
Some of the major players in the global silicon photonics market include Cisco Systems, Inc., Intel Corporation, NeoPhotonics Corporation, MACOM, STMicroelectronics, Rockley Photonics Ltd., SICOYA GMBH, Lumentum Operations LLC, Broadcom, and Hamamatsu Photonics K.K.

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Research Methodology

  •  Desk Research / Pilot Interviews
  •  Build Market Size Model
  •  Research and Analysis
  •  Final Deliverabvle

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