Charles T. Troy
SAN MATEO, Calif. -- From an "introductory" level of $101 million last year, the global market for dense wavelength division multiplexing (DWDM) components is expected to hit $4.17 billion by 2000 and then grow to $12.1 billion by 2005.
According to a new market study by ElectroniCast Corp., the advance will be led by North America with a 44 percent share in 2000 and 47 percent by 2005. North America currently is a net importer of WDM components but, said the report, will evolve into a net exporter by 2005.
The report defines dense WDM as multichannel transport with channel spacings of 2 nm or less. The technology is seen as one more likely solution to the increasing demand for communication bandwidth.
Because initial installed cost will be a factor in which solution triumphs, advances in DWDM component technology give it an advantage in long-haul applications. And, as technology advances further and per gigabit-kilometer costs drop, WDM will increasingly be applied in shorter links, said Jeff D. Montgomery, ElectroniCast chairman.
The report points out that transmitters and receivers are the most vital components, in terms of both cost and technology. While the receiver's detector can be relatively broadband, the laser diodes of the transmitter must be precisely locked to wavelengths within ~±0.1 nm with drift held to equally tight tolerances.
Because of the importance of laser diodes, and a need to continually expand their limits, most tend to be fabricated in-house by major telecom equipment firms. Smaller firms must buy them packaged as modules from independents or from competitors' device-sales groups.
Encouraging competition
By contrast, optical fiber amplifiers are available from multiple suppliers, opening a strong market for manufacturers of laser-diode pump modules. Multiplexer/demultiplexer filter modules also are much less captive than transmit/receive components, and are thus not often found in vertical integration. However, the report says, the potential is large enough to encourage competition among established suppliers and to drive start-up firms.
The "Dense Wavelength Division Multiplex Products Global Market Forecast" is available from ElectroniCasts for $12,000 (US). Contact Montgomery at (415) 343-1398; FAX, (415) 343-1698.