Introduction: With the rapid development of artificial intelligence and high-performance computing, the access speed of data center servers is rapidly increasing, which greatly promotes the growth of demand for optical interconnection. As a key carrier for the interconnection of equipment in data centers, optical modules are expected to continue to expand in the market.
Optical modules play a key role as an important component of photoelectric and electro-optical conversion in optical communication networks. The main function of the optical module is to convert the electrical signal of the device into an optical signal, and convert the optical signal into an electrical signal at the receiving end, so as to ensure the smooth information transmission of the optical communication network. Optical modules have the characteristics of high transmission rate and stability, and are widely used in the optical interfaces of optical network communication equipment such as aggregation switches, core routers, OLTs, and DSLAMs.
It is worth noting that the cost of optical modules occupies a considerable proportion in optical fiber communication systems, especially in high-speed optical modules, which reaches 50% to 60%, which has an important impact on the overall construction cost of the network. Therefore, reducing the cost of optical modules and improving efficiency have become the key factors for the industrialization of optical communications. Components such as lasers, modulators, receivers, and control chips play a key role in optical modules, where the power and stability of lasers are critical to the quality of data transmission.
The optical module industry chain mainly includes four links: chips, devices, modules and equipment. Optical modules are key components in the middle of the industrial chain, and through the procurement of raw materials such as optical chips, electrical chips and optical components from the upstream, and integration, packaging and testing, and finally provided to equipment integrators, optical communication equipment to meet specific needs is formed. The upstream optical chip and electrical chip technology threshold is high, and the R&D cost is expensive, which is mainly dominated by overseas manufacturers. However, due to the relatively low technical threshold of optical module packaging, it has attracted a large number of manufacturers to participate, resulting in fierce competition in the industry.
The downstream demand mainly comes from the telecom market and the data communication market. The competition in the optical module market is fierce, and China's optical module manufacturers continue to improve their competitiveness and market share through continuous accumulation of experience and technology catch-up, combined with competitive advantages such as low labor costs. According to Lightcounting's data, in the TOP10 list of optical modules, Chinese manufacturers have gradually emerged, tied for the top spot with industry giants. Manufacturers such as Accelink, Hisense Broadband, Xinyisheng and Huagong Zhengyuan also entered the top 10. The competitive landscape of the optical module market is relatively fragmented, with a large number of downstream customers and a wide variety of products.
According to Lightcounting**, total transceiver sales for AI clusters will reach $17.6 billion in the next five years, and the global transceiver market size is expected to exceed $20 billion by 2027. Among them, the increase in the number of 800G ports will drive a new round of growth starting in 2023, and is expected to exceed $3 billion in 2026. In addition, with the construction of data centers and the in-depth layout of 5G networks, the optical module market has broad prospects.
In terms of technology, the R&D efforts of optical modules in the high-speed field continue to promote the innovation and upgrading of the industry. The launch of the new generation of GPUB100 will further stimulate the demand for high-speed optical modules. In addition, the cost, energy consumption, and integration of optical modules are also facing higher requirements, which will promote the breakthrough development of LPO, CPO, silicon photonics and other technical paths.
As the core component of the optical communication industry chain, optical modules have broad market prospects driven by the growth of information application traffic demand and the innovation of optical communication technology. By increasing R&D investment, China's optical module manufacturers strive to strengthen the layout of new technology paths and look for opportunities for technological transcendence. With the increase in shipments of new products and the dilution of costs, the performance of optical modules is expected to decrease, further driving the development of the market.
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