Visible Light Communication Market

Market Overview

The global visible light communication market size was valued at USD 18.84 billion in 2022. It is estimated to reach USD 1,966.61 billion by 2031, growing at a CAGR of 67.45% during the forecast period (2023–2031).

Visible light communications (VLC) technology is a developing technology that permits access to high-speed internet, primarily in the indoor environment. The technology works on the principle of intensity modulation in which the existing lighting infrastructure is modulated. Compared to conventional radio-frequency visible light communications provide key advantages that make it more popular in recent days. Furthermore, it is a wireless communication technology that quickly transfers data over the visible light spectrum, ultraviolet and infrared radiation. A system comprises different components, such as a microcontroller, light emitting diode (LED), and photodetector. Light is a prominent source for high-speed data transmission through the photodetector's conversion of light waves into an electric signal.

Market Dynamics

Global VLC Market Drivers

Technological Superiority Over Currently Prevailing Wi-Fi Technology

Visible light communication is a bi-directional wireless communication method similar to Wi-Fi technology. However, the former uses visible light for data transmission instead of RF communication in Wi-Fi and cellular networks. Visible light makes the Li-Fi technology 100 times faster than Wi-Fi, less expensive, and it needs no external power source as it operates with the glowing LED light. Moreover, the absence of RF waves provides visible light communication with the advantage of being used in electromagnetic-sensitive areas, such as hospitals, aircraft, and nuclear power plants, as it does not cause any electromagnetic interference. All these technical superiorities of visible light communication over Wi-Fi technology drive its market in numerous applications such as retail, aerospace & defense, and indoor networking. These technical superiorities of visible light communication over Wi-Fi are expected to fuel up the demand in the market in the following years.

Faster and Safer Data Transfer than Other Technologies

Visible light communication technology is very efficient in terms of energy consumption. The system consumes very low energy by using LEDs for data transmission. This technology is greener, cleaner, and safer as it produces no dangerous emissions, unlike RF, and is biologically safe. Furthermore, visible light communication technology is interference-free, which means it does not generate electromagnetic interference as RF systems produce it. Therefore, it can be utilized in areas where RF wireless communications are not permitted, such as hospitals, chemical plants, oil rigs, or underwater. Hence, faster and safer data communication than competing technologies is the major driving factor for the market.

Global VLC Market Restraint

Suitable Only for Short-Range Communication Applications and Direct LoS Requirements

The main disadvantage of visible light communication technology is that it cannot pass through solid materials like walls, wooden doors, and windows because it depends on light. For the proper functioning of the technology, a direct line of sight (LoS) is required, and the coverage of visible light communication systems is also very less. Therefore, it can be observed that the technology is confined to close spaces. Though it could also mean privacy for the personal user, its use for large-scale delivery of data transmissions is questionable. Hence, the limitation of visible light communication technology, i.e., best used in a closed environment or for shorter distances, further restrains the market's growth.

Global VLC Market Opportunities

The emergence of New Applications such as IoT and 5G

Visible light communication is a disruptive technology that can impact numerous industries. Visible light communication can drive Industry 4.0 applications, provide light-as-a-service (LaaS) in the lighting industry, enable ITS, enhance road safety for semi-autonomous and autonomous cars, allow new ways of health monitoring of aging societies, create new cyber-secure wireless networks, provide new solutions to close the digital divide and enable high-speed wireless connectivity in future data centers.

Visible light communication market trend will play an important role in connecting two major industries, i.e., the wireless communications industry and the lighting industry. In the next 5–10 years, visible light communication will serve numerous applications and be integral to emerging smart cities and Industry 4.0. Therefore, visible light communication has massive potential to provide all the features and facilities and assist in the fast commercialization of IoT and 5G technologies by being considered the potential access option for their applications, creating opportunities for market expansion.

Regional Analysis

Based on region, the global market is bifurcated into North America, Europe, Asia-Pacific, and RoW.

North America Dominates the Global Market

North America is the most significant global market shareholder and is estimated to grow at a CAGR of 67.53% during the forecast period. North America is anticipated to grow rapidly in VLC solutions over the forecast timespan owing to the early adoption of technically advanced products in the end-user industries. The U.S. and Canada contribute significantly to the overall revenue in the market. The U.S. is a major revenue-generating country because of the presence of a large base of existing users. The growing application of VLC solutions and connected devices are factors driving the growth of the North American VLC market. In addition, the rising application of visible light communication and connected devices are boosting the growth of the North America visible light communication market. Large automotive, manufacturing, aerospace, and electronic industries are producing an enormous opportunity for the North American visible light communication market in the forecast period.

Further, the U.S. government initiatives, such as "Gigabit Communities," which help make the United States one of the high-capacity and super-fast ubiquitous broadband networks, enhance the adoption of VLC opportunities. Smart city initiatives and the rising trend of smart homes in North America are also contributing to the growth of the market.

Europe is estimated to exhibit a CAGR of 66.89% over the forecast period. Demand for wireless services in Europe is soaring even more with future 5G and 6G services insight. The European Commission is determined to join regional and European forces to spread optic wireless connectivity. The key market players in Europe are Oledcomm, LightBee, Signify Holding, Oledcomm, Lucibel, pureLiFi Limited, and Fraunhofer HHI, among others. These players are focusing on product development strategies. For instance, in February 2019, Zomtobel, a European provider of professional lighting and associated services, partnered with pureLiFi to enter the wireless enterprise network market. Zumtobel installed pureLiFi's system alongside its LED lights as part of the trial. The system transmits data via an LED luminaire at high speeds through small adjustments in the LED's brightness. Therefore, the factors above create opportunities for market growth in the region.

In Asia-Pacific, the market is promising. The market for visible light communication in this region is projected to grow over the coming years as consumer interest in cutting-edge technology grows. Initiatives are being taken by the governments of nations, including China, South Korea, Japan, and India, to advance technologies that utilize optical wireless communication. In addition, China dominates the visible light communication market share in Asia-Pacific. The visible light communication team of NDSC China has collaborated to build a commercial-grade high-speed visible light communication chipset. Japan also enjoys a considerable market share due to the large number of visible light communication market players. The Visible Light Communication Consortium (VLCC) was also established in 2003 by Japanese tech companies. The country also tries to raise public awareness for VLC and promote its applications, thereby driving regional market expansion.

The RoW comprises the Middle East and Africa and South America. The region is projected to witness a modest growth rate compared to other regions over the forecast period. Hence, the region is estimated to exhibit a relatively low growth rate than other regions and countries. However, in the Middle East, wireless connectivity development is boosted by the Smart City projects undertaken by the Governments to national strategies to leverage long-term sustainability. IoT mobile networks will also be placed securely to connect sensors across regional cities, supporting smart city initiatives—for instance, the Smart Dubai project. Light Communication technologies, including Light Fidelity (LiFi), have attracted increased attention in UAE over recent years within several industries, like smart cities and homes, industry 4.0 and manufacturing environments, and retail and tourism. Such factors drive regional market growth.

Segmental Analysis

The global visible light communication market is segmented by transmission type, component, and application.

Based on transmission type, the global market is divided into unidirectional and bidirectional networks. 

The unidirectional network segment dominates the global market and is estimated to grow at a CAGR of 67.88% over the forecast period. Unidirectional transmission is the most common type of transmission as most IoT devices, such as smartphones or sensors, cannot support the bidirectional VLC since it is difficult to provide the uplink communication from the IoT device to LED owing to its low power and low processing capability. In the unidirectional VLC, only the downlink from the LED light to the IoT device will use VLC communication. In contrast, the uplink channel from the IoT device to the LED light will use other wireless communication technologies, like Wi-Fi or Bluetooth. Moreover, the growing studies of IoT services over unidirectional VLC networks are expected to boost the market over the coming years.

Bidirectional Visible Light Communication Transmission is in the early growth stages, and several ongoing research projects are being carried out on bidirectional Visible Light Communication. For instance, Axrtek introduced the MOMO bidirectional RGB LED VLC system in October 2014; it has a range of 25 feet and 300 Mbit/s of transmission speed up and down. Moreover, driven by the increase in automation, sm smart home technologies based on multi-device bidirectional visible light communication (VLC) are expected to gain new opportunities in the coming years.

Based on components, the global market is bifurcated into microcontrollers, photodetectors, light-emitting diodes (LED), and software. 

The light-emitting diode (LED) segment is the most significant contributor to the market share and is estimated to grow at a CAGR of 67.77% over the forecast period. The sale of LEDs for visible light communication systems is included in the light-emitting diode segment of the market. LEDs are highly power efficient, have low carbon emissions, are free from mercury, are durable, and produce good quality illumination. Moreover, by using LEDs, the modulation bandwidth of visible light communication systems can be significantly improved. This, in turn, augments the adoption of LEDs for visible light communication systems. Similarly, several studies have found that LEDs can increase the VLC transmission data speeds.

The photodetector segment covers the revenue generated by selling photodetectors in visible light communication systems. The light-emitting diodes (LED)-based photodetectors are widely used in the market. LED has both light-emitting and detecting properties. Thus, visible light communication systems combine light emitting and detection in one single device by integrating LED-based photodetectors. Optical wireless communication can be easily achieved for bidirectional visible light communication networks at a low cost with the help of photodetectors. This, in turn, majorly drives the photodetector segment in the market.

Based on application, the global market is segmented into consumer electronics, vehicle and transportation, hospitals, smart stores, defense and security, and others.

The vehicle and transportation segment owns the highest visible light communication market share and is estimated to grow at a CAGR of 69.26% during the forecast period. At traffic signals, VLC is used to communicate with passing vehicles via their LED lighting, which can aid in better traffic management, increasing traffic flow and decreasing accidents. Also, VLC can alert drivers when other vehicles are too close. With the introduction of intelligent vehicle safety applications, VLC technology will increase traffic signals, vehicles lamp, and transport systems. Similarly, with the growth of autonomous vehicles and electric vehicles, VLC technology will find increased applications in the vehicle and transportation segment over the coming years.

VLC is quickly becoming a popular technology for consumer electronics that use lighting. Mobiles, laptops, tablets, and other smartphones can connect using VLC technology. The short-range network of VLC can yield exceptionally high data rates and higher security. In consumer electronics and equipment, VLC-based device control is becoming commercially available. Moreover, as home automation is becoming a trend in modern homes for several purposes, such as safety and security, VLC offers illumination plus wireless connections and would also provide more diverse control for smart home devices.

Recent Developments

• October 2023- Casio Computer Co., Ltd. announced that it would expand the responsibilities of its Dubai subsidiary to encompass more of Africa and will strengthen its sales structure to expand its business in Africa. Accordingly, the local subsidiary's name will be changed from CASIO Middle East FZE to CASIO Middle East and Africa FZE on November 1, 2022, and operations will commence under the new name on that date.
• July 2022- The Scottish National Investment Bank granted EUR 10 million to Edinburgh-based PureLiFi, which has spent years developing a new Visible Light Communication (VLC)-based networking method called LiFi, to support the global implementation of their revolutionary technology.