23 October 2018

VCSEL market to grow at 16.9% CAGR from $1.78bn to $3.89bn by 2023

The vertical-cavity surface-emitting laser (VCSEL) market will rise at a compound annual growth rate (CAGR) of 16.9% from $1.78bn in 2018 to $3.89bn by 2023, according to a report ‘VCSEL Market Report 2018 - Global Forecast to 2023’ by the firm Markets and Markets.

Growth can be attributed mainly to the rising adoption of VCSELs in proximity sensing and medical applications, the increasing use of VCSELs for data communications, the growing usage of VCSELs in infrared illumination, and the surge in demand for VCSELs with advancements in automotive electronics. However, limited data transmission range is restricting the growth of the VCSEL market.

InP VCSELs to grow fastest

By material, the VCSEL market is segmented into gallium arsenide (GaAs), gallium nitride (GaN), indium phosphide (InP), and others, including gallium indium nitrogen arsenide (GaInNAs), indium gallium arsenide (InGaAs), indium aluminum gallium arsenide (InAlGaAs), and aluminum gallium arsenide (AlGaAs).

The market for InP is expected to grow at the highest CAGR. VCSELs operating in 1300-1550nm wavelength range are rapidly evolving and are mostly InP-based. The high growth of this material can be attributed to its high wavelength compatibility and use in high-speed communication applications.

Single-mode to grow faster than multi-mode

By device type, compared with multi-mode VCSELs, the market for single-mode VCSELs is expected to grow at a higher CAGR, due to their ability to provide solutions to many sensing applications, especially in the consumer electronics industry.

Emerging applications to grow at highest CAGR

The market for emerging applications - such as light detection and ranging (LiDAR), night vision, atomic clocks, GPS, magnetometers and displays - is expected to grow at the highest CAGR. Currently, this market is in the nascent stage, but it is expected to see high growth in the coming years due to the use of VCSELs for high-quality vision and obstacle detection etc.

Data center held largest share of VCSEL market in 2017

By end user (data center, consumer electronics, automotive, industrial, healthcare, and military data center, consumer electronics, automotive, industrial, healthcare, and military), data centers (which largely use 850nm-emitting VCSELs, especially for applications where the size of the data transmitted over a network is extremely large) accounted for the biggest share of the VCSEL market in 2017.

In data centers, high data transfer rates are extremely important as they allow fast transmission of data for processing and obtaining results. As the adoption of data analytics increases in businesses worldwide to improve decision-making capabilities, demand for VCSELs in data centers is expected to rise further.

The market for consumer electronics is expected to grow at the highest CAGR. With increasing implementation of VCSELs for advanced features such as laser autofocus and proximity sensors in smartphones, the consumer electronics segment has created a huge shift in the overall VCSEL market. Also, other applications such as video signal to display, video signal from one or more cameras, low-noise microphone, and gesture recognition are expected to create huge demand.

Americas the largest shareholder; APAC to register highest CAGR

The Americas accounted for the major share of the overall VCSEL market in 2017, and is the largest market due to demand from technology giants such as Facebook, Google, Apple and Amazon. Moreover, the growing emphasis of businesses on the use of cloud infrastructure has contributed to the increasing demand for VCSEL-based optical transceivers in the Americas.

The VCSEL market is expected to grow at the highest CAGR in the Asia-Pacific (APAC) region during 2018-2023. This growth can be attributed to the rising number of data centers and increasing demand for consumer electronic devices and premium automobiles. APAC countries such as China, India, Singapore and Indonesia are emerging as hubs for data centers due to advancements in basic telecom infrastructure and encouragement from respective governments.

Major players in the VCSEL market are cited as Finisar (USA), Lumentum (USA), Broadcom (USA), Philips Photonics (Germany), II-VI (USA), IQE (UK), AMS Technologies (Germany), Vixar (USA), Santec (Japan), VERTILAS (Germany), Agiltron (USA), Alight Technologies (Denmark), Ultra Communications (USA), Laser Components (Germany), Litrax Technology (Taiwan), Coherent (USA), TT Electronics (UK), Newport (USA), NeoPhotonics (USA), and Necsel Intellectual Property (PD-LD) (USA).

Factors such as technological advancements in the consumer electronics sector and the evolution of laser-based hard disc drive technology are expected to generate opportunities for players in the VCSEL market.

http://www.semiconductor-today.com/news_items/2018/oct/markets-and-markets_231018.shtml