LightCounting: The optical communications industry will be the first to recover from the COVID-19

In May., 2020, LightCounting, a well-known optical communication market research organization, said that by 2020, the development momentum of the optical communication industry is very strong. At the end of 2019, the demand for DWDM, Ethernet, and wireless fronthaul surged, resulting in a shortage of supply chains.

However, in the first quarter of 2020, the COVID-19 pandemic forced factories around the world to close, and supply chain pressure rose to a whole new level. Most component suppliers report lower-than-expected revenues in the first quarter of 2020, and expectations for the second quarter are very uncertain. The factory in China was reopened in early April, but most companies in Malaysia and the Philippines are still shutting down, and companies in Europe and North America have just begun to resume work. LightCountin believes that the current demand for optical connections in telecommunications networks and data centers is even stronger than at the end of 2019, but some network and data center construction projects have been delayed due to the pandemic. Optical module suppliers will not be able to meet their original production plan this year, but the sharp drop in product prices may slow down in 2020.

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LightCounting expects that if the entire industry reopens in the second half of this year, optical component and module suppliers will resume full production in the fourth quarter of 2020. It is expected that the sales of optical modules will increase moderately in 2020 and will increase by 24% by 2021 to meet the demand for greater bandwidth for applications.

In addition, driven by China’s accelerated 5G construction, sales of optical devices for wireless fronthaul and backhaul will increase by 18% and 92%, respectively, which is still the target for this year. In addition, the sales of FTTx products and AOCs in the optical interconnection category, driven by the deployment in China, will grow by double digits by 2020. Ethernet and DWDM market share will resume double-digit growth in 2021.

Post time: Jun-30-2020