Optical amplifier market expected to grow to over $7 billion

Jan. 5, 2001
The worldwide market for optical amplifiers for telecommunications applications is forecast to grow from over $3 billion in 2000 to over $7 billion in 2004, a compounded growth of 22% per year.

The worldwide market for optical amplifiers for telecommunications applications is forecast to grow from over $3 billion in 2000 to over $7 billion in 2004, a compounded growth of 22% per year, according to a report just released by Strategies Unlimited (Mountain View, California), an optoelectronics industry market research firm. The report, entitled �Optical Amplifiers: Raman, EDFA, EDWA, and SOA, Market Review and Forecast-2001,� analyzes the market for optical amplifiers and their associated pump lasers for different applications, device types, wavelengths, and data rates.

Optical amplifiers are a key component in long-distance telecom networks and cable television distribution systems. The amplifiers are used in these systems to extend the length of optical links and to boost the signals entering ultra-sensitive optoelectronic detectors along long-distance routes. Optical amplifiers have enabled the migration to dense wavelength division multiplexing (DWDM) systems that now have the capability to carry over 10 million telephone conversations, or over 100,000 video channels, over a single fiber. The operation and design of these systems, and of the optical amplifiers and their components, is considered exceptionally sophisticated, and the performance requirements on the components are especially demanding.

The optical amplifier emerged as a commercial product in the early 1990s and is now widely used, but the market is entering a new phase. At the high-performance end of the market, erbium-doped fiber amplifiers (EDFAs) will be complemented by new Raman pump blocks. While EDFAs will continue to thrive in a variety of applications, the emergence of Raman amplification will substantially change the design of EDFAs, as well as the mix of pump laser products needed to drive the amplifiers.

At the lower performance end, sales volumes of optical amplifiers are now sufficient to enable the use of new, lower-cost technologies for a wider set of applications. New technologies such as erbium-doped waveguide amplifiers (EDWAs) promise to become the natural extension of EDFAs into the low-cost market. Semiconductor optical amplifiers (SOAs) have been studied for decades and now also appear poised to reach commercial success in this low-cost market. Low-cost EDFAs also promise to compete strongly.

Nearly $1.6 billion of lasers were manufactured to pump the optical amplifiers. Nearly all pump lasers are semiconductor lasers, but fiber lasers are also used for EDFA and Raman applications. Like the optical amplifier business, the pump laser market is also very dynamic, with many new suppliers promising to take market share from established players. New technologies, such as vertical-cavity lasers, suggest that a lot of innovation may be yet to come.

About Strategies Unlimited:

Founded in 1979, Strategies Unlimited provides market intelligence for the RF/wireless, optoelectronic, optical communications, compound semiconductor, and photovoltaic components industries. The company is based in Mountain View, California.

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