Pluggable Optics for Data Center Market is expected to reach US$ 12.35 Billion by 2031

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

According to our latest study on "Global Pluggable Optics for Data Center Market – Global and Regional Share, Trend, and Growth Opportunity Analysis – by Component, Data Rate, and Geography," the market size was valued at US$ 5.23 billion in 2023 and is expected to reach US$ 12.35 billion by 2031. The pluggable optics for data center market is estimated to record a CAGR of 11.3% from 2023 to 2031. Data centers are increasingly using and demanding pluggable optics for swiftly adjusting to changing bandwidth demands without having to replace complete switches or routers, which makes them an ideal choice for dynamic situations. Moreover, pluggable optics support data center operators in high-speed transmission, optimize power, promote high-speed transmission, and simplify network architecture. Thus, the increasing preference for cost-effective solutions and manufacturers' focus on product development activities contribute significantly to the pluggable optics for data center market growth.

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.

• In June 2023, Amazon.com, Inc. announced plans to invest US$ 7.8 billion by 2030 to expand its construction of a data center in Ohio. This data center aims to power with at least 95% renewable energy. The company is committed to reaching net-zero carbon emissions by 2040 and powering operations with 100% renewable energy by 2025.

• In May 2023, Prime Data Centers announced the expansion of the Phoenix market in Avondale, Arizona. Prime Phoenix is a 66.5-acre campus featuring five data centers having 210 megawatts of critical power and 1.3 million square feet of space. The project will result in a high-density, sustainable data center campus that is designed to support hyperscale services providers, large Internet brands, worldwide technology enterprises, and Fortune 500 businesses.

Pluggable Optics for Data Center Market

Rising Need for High-Performance Computing to drive Pluggable Optics for Data Center Market Size

High-performance computing (HPC), or supercomputing, is a practice of combining computing power in a way that produces significantly more horsepower than traditional computers and servers. According to IBM, it is more than one million times faster than the fastest commodity desktop, laptop, or server systems. HPC is a method of processing massive amounts of data at extremely high speeds using multiple computers and storage devices. A high volume of calculations in a short amount of time is needed in today’s business landscape for faster operations. Many HPC data centers are linked to large private and public companies that require a lot of computing power. The HPC power helps businesses solve problems that would otherwise be impossible to solve using traditional computing systems.

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 pluggable optics for data center market share in 2023. Switches in data center 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.

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

The pluggable optics for data center market report emphasizes the key factors driving the market and prominent players' developments. Coherent Corp, Nokia Corp, Cisco Systems Inc, Infinera Corp, Telefonaktiebolaget LM Ericsson, Ciena Corp, Intel Corp, Lumentum Holdings Inc, Juniper Networks Inc, Marvell Technology Inc, Yangtze Optical Fibre and Cable Joint Stock Ltd, and Broadcom Inc are among the prominent players profiled in the 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 March 2023, Infinera Corporation launched a new portfolio of coherent optical subsystems and coherent pluggable optical engines. These products are designed to help network operators reduce their carbon footprint and meet the ever-increasing demand for bandwidth while being cost-effective. The new solutions include a line of high-performance transmit-receive optical sub-assemblies (TROSAs), innovative programmable digital signal processors (DSPs), and a line of high-performance, intelligent pluggable optical transceivers.
  
  
• In December 2023, Coherent Corp introduced its 800G ZR/ZR+ transceiver in ultracompact QSFP-DD and OSFP form factors for optical communications networks. The 800G ZR/ZR+ transceivers from Coherent are the world’s first digital coherent optics (DCO) that can plug directly into QSFP-DD and OSFP transceiver slots on IP routers. Leveraging their high output power of 0 dBm, these transceivers can connect routers directly to access metro and regional DWDM transport networks without additional intermediary interfaces, eliminating an entire layer of optical equipment and thereby significantly reducing both capital and operational expenditures.

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