North America Pluggable Optics for Data Center Market is expected to reach US$ 4.99 Billion by 2031

North America Pluggable Optics for Data Center Market Forecast to 2031: Key Insights

According to our latest study on "North America Pluggable Optics for Data Center Market – Regional Share, Trend, and Growth Opportunity Analysis – by Component, Data Rate, and Geography," the North America pluggable optics for data center market size was valued at US$ 2.09 billion in 2023 and is expected to reach US$ 4.99 billion by 2031. The market is estimated to record a CAGR of 11.5% from 2023 to 2031. The rising demand for linear pluggable optics is likely to be North America pluggable optics for data center market trends.

The North America pluggable optics for data center market report emphasizes the key factors driving the market and prominent players' developments. In North America, the government and several market players are focused on building data centers to meet the growing need for storage solutions and high-performance computing capabilities. The increase in digitalization and data-driven approaches adopted by businesses encourage them to adopt solutions that help them store and analyze large data sets. This has fostered the data center market growth in the region, generating the demand for pluggable optics. The rising investment in data centers and demand for energy-efficient solutions are further driving the North America pluggable optics for data center market growth.

North America Pluggable Optics for Data Center Market

Key companies are investing in the development of data centers in North America region. As per the Linklaters, North America has maintained its lead in data center transaction values, accounting for an impressive 62% of the global total in 2023 and 69% of investments through April 2024, totaling US$ 15 billion, with the US accounting for the largest share of the total. A few instances are mentioned below:

• In February 2024, NTT DATA—a global digital business and IT services leader—announced that TC Global Investments Americas LLC (a group company of Tokyo Century Corporation) invested in NTT Global Data Centers' American data center business in Chicago, Illinois, a group company of NTT DATA, to cater to continuous demand for cloud services and the broader use of generative AI and other technologies.

• In May 2024, the US President announced a US$ 3.3 billion investment by Microsoft to build a new artificial intelligence (AI) data center. The investment is part of President Biden's "Investing in America agenda," which is focused on creating jobs in critical sectors such as infrastructure, clean energy, semiconductors, and biotechnology by mobilizing private sector investments in the US through legislation such as the CHIPS and Science Act.

Rising Need for High-Performance Computing to drive North America Pluggable Optics for Data Center market

HPC is about the interconnection of many storage, computing, and networking systems, which generates the need for cost-effective, sustainable, and scalable optical networking solutions. This factor fuels the need for high-bandwidth pluggable transceivers for HPC data centers. Various companies in the region are focused on launching data centers or expanding their facilities to handle HPC workloads. For example, in March 2024, DC Blox expanded its data center in Birmingham, Alabama, to cater to HPC workloads. The surging demand for HPC applications driven by several factors, including the availability of cost-effective HPC systems based on commodity hardware, specialized processor accelerators such as GPUs, and the increasing utilization of AI/ML applications, propels the market growth.

North America Pluggable Optics for Data Center Market: Segmental Overview

Based on component, the market is segmented into switches, routers, and servers. The switches segment held the largest share in the North America pluggable optics for data center market share in 2023. In data centers, switches are used to connect multiple devices to create a network. It is a specific system administration device designed for storage area networks (SANs). These switches work at the core of data centers. They facilitate high-speed and low-latency data transfer among servers and capacity devices. They provide a devoted and dependable pathway for storage-concentrated applications. They emphasize efficient data transmission and ensure optimal performance and operations in the data centers. Several companies provide switches for data centers. For example, Cisco provides 25-gigabit pluggable transceivers for data center applications. This cost-effective Ethernet technology provides 25G switches and high-bandwidth servers with 25G Network Interface Cards (NIC). The demand for pluggable optics such as switches has been increasing to handle the data center traffic efficiently.

North America Pluggable Optics for Data Center Market Analysis: Competitive Landscape and Key Developments

Coherent Corp, Nokia Corp, Cisco Systems Inc, Infinera Corp, Telefonaktiebolaget LM Ericsson, Ciena Corp, Intel Corp, and Lumentum Holdings Inc are among the prominent players profiled in the North America pluggable optics for data center market report. The market players focus on new product launches, expansion and diversification, and acquisition strategies, which allow them to access prevailing business opportunities. A few of the key market developments are listed below:

• In April 2024, Infinera announced that Aire Networks, a subsidiary of Grupo Aire, deployed Infinera's software-programmable ICE-X coherent pluggable solution to expand the capacity of its single-fiber network infrastructure across Spain and Portugal. The ability of Infinera's innovative ICE-X solution to provide ultra-high-speed transmissions over a single fiber in a pluggable form factor enables Aire Networks to continue to meet the bandwidth demands of its customers while maintaining its cost-effective single-fiber infrastructure.
  
  
• In October 2022, Cisco announced that SoftBank Corp. deployed Cisco pluggable optical transceivers in its metro area network to support 4G/5G, enterprise, and broadband services. By deploying the Cisco QSFP 100G ZR4 pluggable optical transceivers, SoftBank reduced power consumption and the carbon footprint for 100G links up to 80 km apart, providing faster connectivity between network locations across wide footprints. The solution provides increased capacity to connect geographically distant sites to the network more efficiently, ensures high reliability, consumes less rack space, and lowers power consumption, all of which contribute to operational efficiencies and sustainability.

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