Next year will remain strong, with revenue forecasts of 985 million. Demand for PON equipment—both OLTs and ONTs—is driving the FTTx optics market to record levels.
Julie Kunstler, principal analyst on Ovum's smart networks and components team and author of the report, commented: "Numerous positive factors are propelling the FTTx optics market to new heights, including China Mobile's FTTH network rollouts and the ongoing network construction by China Telecom and China Unicom."
Other positive trends contributing to the strong growth include FTTx network deployments in North America, Google Fiber's expansion plan, US telecom deployment plans, European deployment plans, continued deployments in the Middle East, smaller deployments in South and Central America and Africa, and the shift towards FTTp or FTTh (which require more PON ONT optics).
The Ovum report highlights several key findings from the forecast:
• The total number of OLT transceivers will reach 6.5 million in 2015, a 19% increase over 2014.
• Next-generation OLT transceivers will account for just over 12% of the total OLT transceiver market in 2020, with 10G EPON OLTs representing the largest segment within next-generation PON.
• The total ONT/BOSA transceiver market is forecast to exceed 71 million in 2015, an 18% increase over 2014.
• Next-generation ONT/BOSA transceivers are forecast to account for just over 9% of the total ONT/BOSA transceiver market in 2020, with 10/1 and 10/10 EPON ONTs representing the largest segment within next-generation PON.
Ovum's PON optical component forecast does not include any large FTTx deployments in the densely populated countries of India, Brazil, and Indonesia. "Large deployments in these countries would provide a significant boost to the forecasted units and, consequently, to revenue," stated Kunstler, "as would faster next-generation PON deployments because ASPs for next-generation PON optics are superior to those for non-next-generation PON."
The biggest potential downside to the forecast could come from a slowdown in FTTx deployments by Chinese operators. China is the world's largest consumer of PON optics, and a slowdown would negatively impact the forecast. However, Ovum believes that China's newest FTTx operator, China Mobile, is well-positioned to deploy an FTTx network, bringing existing mobile customers to its new fixed broadband network and offering additional services.
"This strong outlook benefits Japanese optical subcomponent vendors such as laser and lens manufacturers. Meanwhile, the rebound in the FTTx fixed broadband telephony market is having a positive impact on component and equipment suppliers," Kunstler concluded.
