Global VCSEL for Data Communication Market Size Grows at a Staggering CAGR of 14.40%

Introduction

A vertical cavity surface emitting laser (VCSEL) is a type of laser diode that has the potential to revolutionize fiber optic communications by boosting data speed and efficiency. VCSELs produce energy at 850 and 1300 nanometers (nm). These wavelengths relate to electromagnetic radiation in the near-infrared (IR) range. Edge-emitting lasers are being replaced by VCSELs as the standard technology for local networks and short-range data communications networks due to their reduced cost of production and improved dependability. 850nm-emitting VCSELs are frequently used in data centers, particularly for applications where the amount of data being carried over a network is very significant. Demand for VCSEL technology is rising as more prominent organizations adopt data centers.

Market Dynamics

Rising Demand for VCSELS in Data Centers Drives the Global Market

Data centers are essential parts of the Internet's infrastructure and are used for data access, computation, and storage. A high-performance computing (HPC) system is a step beyond the most basic data center, which is a tiny server room. One of the essential parts of IT infrastructure for many firms is the data centers. The top corporations now rely on data centers for well-organized storage and handling of data due to the vast volumes of data generated daily. High data transfer rates in data centers are significant as they enable high-speed processing and result in retrieval, which fuels rapid market growth for VCSELs.

Surging Demand for Wireless Connectivity Creates Tremendous Opportunities

The market for VCSEL for data communication is experiencing new development potential because of the sharp increase in demand for wireless technologies. Numerous companies are using the improvements in wireless communication technology, particularly cellular technologies, to track their assets globally. The wireless device makes it easier to record data from distant stations and field devices that are otherwise inaccessible for process and infrastructure applications. Wireless networks are also popular among industries because they can be installed quickly and efficiently to support M2M communication even in harsh situations. These elements have helped the market for VCSEL for data communication expand, particularly in highly industrialized areas. Future VCSEL for data communication market growth is anticipated to be profitable because of these factors.

Regional Analysis 

North America is the largest shareholder in the global VCSEL for data communication market and is anticipated to grow at a CAGR of 12.8% during the forecast period. The development in optoelectronic device performance, the decreased cost of VCSELs, and their wavelength range of 480 to 1300 nm are the primary factors propelling this market's profitable expansion in North America. There will be an increase in the use of VCSEL due to the introduction of new data transmission technologies and their anticipated faster expansion during the forecast period.

Europe is expected to grow at a CAGR of 13.90%, generating USD 160.89 million during the forecast period. The VCSEL market is expected to expand rapidly in Europe over the forecast period due to the increased demand for VCSEL in data communications for short-distance connections in intra-data centers. Using these infrared lasers for long wavelength and high-capacity communications to link cities has never been attempted. According to Philips Photonics, which develops VCSEL technology solutions for data communications and other applications, the VCSEL Pilot Line for Illumination, Datacom, and Power Applications Project has been completed (VIDaP).

A significant component of the global market is in the Asia-Pacific region. The reason for this is the acceleration of technological advancement and the expansion of the telecommunications sector in developing countries like Japan, China, and India. Due to the region's affordable automobile market and expanding per capita income, the VCSEL market in Asia-Pacific is expected to undergo a substantial transformation in the following year. The increased adoption of VCSEL technology in the telecommunications sector is the main factor driving the expansion of the Asia-Pacific VCSEL market.

Key Highlights

• The global VCSEL for data communication market size was valued at USD 156.5 million in 2021. It is projected to reach USD 459.12 million by 2030, growing at a CAGR of 14.40% during the forecast period (2022-2030).
• Based on type, the global VCSEL for data communication market is bifurcated into single mode and multi-mode. The multi-mode segment is the highest contributor to the market and is expected to grow at a CAGR of 14.7% during the forecast period.
• Based on material, the global VCSEL for data communication market is bifurcated into gallium nitride, gallium arsenide, indium phosphide, and others. The gallium arsenide is the highest contributor and is anticipated to grow at a CAGR of 13.6% over the projected period.
• North America is the largest shareholder in the global VCSEL for data communication market and is expected to grow at a CAGR of 12.8% during the forecast period.

Competitive Players

Competitive Players

The global VCSEL for data communication market’s major key players are Hamamatsu Photonics K.K, Trumpf, II-VI Incorporated, RPMC Lasers, Bandwidth10, Vixar Inc. (Osram Opto Semiconductor), Vertilas GmbH, VI Systems GmbH, Ushio America, INC., and Vertilite.

Recent Developments

Market News

• In August 2022 - The world leader in VCSEL and photodiode solutions, TRUMPF Photonic Components, introduced a brand-new, cutting-edge product platform for its single-mode VCSEL products for commercial and industrial uses. Due to their use in quality and safety monitoring systems, Industrial applications using VCSELs for optical sensing or laboratory test and measurement equipment must be effective and extremely accurate. With the help of the brand-new, cutting-edge VCSEL platform, these needs are met.
• In September 2022 - TRUMPF will demonstrate the new Eco Cooler, a green cooling option for laser-cutting equipment, at this year's EuroBLECH trade event. Fluorinated gases, usually referred to as F-gases, are the coolant used in conventional cooling systems. This has several drawbacks, including the energy-intensive cooling procedure and the environmental impact of disposing of these F-gases. In contrast, the Eco Cooler from TRUMPF employs pure water as a coolant. As a result, it eliminates hazardous chemicals and uses up to 80% less energy for refrigeration.

Segmentation

Global VCSEL for Data Communication Market: Segmentation

By Type

• Single Mode
• Multi-Mode

By Material

• Gallium Nitrite
• Gallium Arsenide
• Indium Phosphide
• Others

By Regions

• North America
• Europe
• Asia-Pacific
• LAMEA