Global Optical DWDM Equipment Market Revenue Surpasses $18 Billion By 2028

In recent years, coherent optical transmission technology has become an essential part of high-capacity, long-distance fiber optic networks.
Highly complex digital signal processor (DSP), is the core of the coherent transceiver, it is responsible for the implementation of coherent transmission of the signal processing is essential to the realization of the next generation of optical networks, "digital heart". This technology-related breakthrough has undoubtedly given a strong impetus to the growth of the global DWDM equipment market.
Recently, Dell 'Oro Group, a telecommunications, networking and data center market intelligence firm, released a five-year forecast to January 2024 for global optical transport. The report predicts that by 2028 coherent DSPs will drive global DWDM market revenues to exceed $18 billion.
Behind this forecast is the rapid development of next-generation coherent DSP technology, particularly those coherent DSP devices capable of delivering wavelength speeds in excess of 1 Tbps. DSPs are part of a larger electronic system within each coherent transceiver, and enhancements in the areas of range, efficiency, and power consumption provide significant opportunities for the industry to continue to improve coherent transceivers. Coherent DSP devices in excess of 1 Tbps drive market growth over the next five years.
We expect the next generation of coherent DSPs to grow at an even faster rate over the next five years, with more than half of the DWDM market revenue expected to come from shipments of 1.2 Tb/s and 1.6 Tb/s line cards by 2028," noted Jimmy Yu, group vice president, Dell 'Oro. These new line cards can bring 400Gb/s wavelengths into ultra-long-haul applications spanning thousands of kilometers, while 800Gb/s wavelengths are used in other scenarios."
Indeed, the past year has seen breakthroughs in next-generation coherent DSPs with designs capable of 1.2Tb/s and 1.6Tb/s single-carrier wavelengths. For example, CIM 8 technology, developed by Acacia (now a Cisco-owned optical device supplier), has been able to support data rates of up to 1.2Tb/s. This technological breakthrough has undoubtedly given a strong impetus to the growth of the global DWDM equipment market.
In the field of high-speed optical communications, Fujitsu (Fujitsu) has introduced the 1FINITY ultra-optical system, which has a single-wavelength data rate of up to 1.2Tb/s and has the potential to be further upgraded to 1.6Tb/s. The system features the latest semiconductor technology and is capable of supporting data transmission rates of up to 1.2Tb/s. The system features a digital signal processor (DSP) using the latest semiconductor processes, and liquid-cooled cooling capacity that is twice that of conventional technology. It also uses other technologies, including Fujitsu's continuous C+L ROADM architecture, which enables it to process multiple wavelength bands in a single product, and optical signal amplification technology for forward Raman amplification.
Meanwhile, Infinera's ICE7 optical engine platform is capable of supporting 1.2 Tb/s single-wavelength transmission and 800G-based transmission over distances of up to 3,000 kilometers. As the latest generation of light engine launched by Infinera, it is its breakthrough innovation in high-speed coherent optical networking solutions. The solution leverages the power of Infinera's vertically integrated ICTR140 TROSA and a custom digital signal processor (DSP) optimized for high baud rate transmission.
Ciena's Wavogic 6 solution, a 1.6Tb/s single-carrier wavelength coherent optical solution for metro ROADM deployments, is capable of supporting 800Gb/s transmission and connectivity on the longest links and energy-efficient 800G pluggable technology over distances of 1,000 kilometers.
Research analysts also made predictions about trends in fiber optic systems in the release of the 2024 Fibre Yearbook:
- 400Gb/s ultra-long-haul transmission breakthrough, 800Gb/s widespread adoption
A major breakthrough in coherent DSP technology for metro and long-haul optical networks has been achieved with the introduction of 1.2Tb/s transmission capacity. This new generation of DSPs is expected to realize ultra-long-haul transmission of 400Gb/s and wide application of 800Gb/s. 400+ Gb/s wavelengths are expected to account for more than 60% of capacity shipments by 2024.
- Long-haul transport equipment will grow faster than metro equipment
In addition, the report states that the DWDM long-haul equipment market will grow faster than metro equipment, with shipments of coherent wavelengths capable of terabit-level speeds projected to grow at a CAGR of 200% over the next five years.
- Big increase in new equipment with baud rates over 100 GHz
By 2028, the share of new devices with baud rates over 100 GHz is expected to exceed 40%. This trend suggests that high baud rate technologies will reduce the total number of wavelengths per fiber, but reduce costs while providing better performance and longer reach. The development of these cutting-edge technologies bodes well for the future prosperity and diversity of the optical communications market.
In the coming years, with the continuous development and popularization of the new generation of coherent DSP technology, the DWDM equipment market is expected to continue to maintain strong growth momentum. This will not only bring great business opportunities for related vendors, but also promote the technological progress and business innovation of the entire telecom industry.