Market Insights:
Superior benefits of photonic integrated circuits in terms of power consumption (energy efficiency), size, speed, and cost collectively drive the photonic integrated circuits (PIC) market. In addition, escalating demand for high-speed communication, especially in the optical communication field, has further fueled market momentum. These factors are expected to contribute toward a compounded annual growth rate (CAGR) of 25.2% from 2015 to 2022. However, the slow transition toward digitization and issues related to design and fabrication are some of the major challenges the photonic IC market faces. The photonic integrated circuits market is expected to cross US$ 1,300 Mn by 2022, expanding at a CAGR of 25.2% during the forecast period from 2015 to 2022.
Purpose of the Report
The purpose of this strategic research study titled “Global Photonic IC Market- Growth, Share, Opportunities, and Competitive Analysis, 2015 – 2022” is to offer industry investors, company executives, and industry participants in-depth insights to enable them to make informed strategic decisions related to the opportunities in the global web security industry.
Target Audience
- Industry Investors
- Raw Material Suppliers
- Photonic IC Manufacturers
- Photonic Equipment/Products Manufacturers
- End-users
Raw Material Segmentation Analysis
The selection of surface material to be used while carrying out photonic integration is a crucial consideration. This is true since photonic integration derives maximum value from its ability to integrate multiple functions into a single material substrate. As the such, proper selection of material substrate is crucial from both functionality and cost perspectives.
Based on different raw materials used, the global photonic integrated circuits (PIC) market is segmented into the following categories
- Indium Phosphide (InP)
- Gallium Arsenide (GaAs)
- Silicon (Si)
- Silicon-on-Insulator (SOI)
- Others (Lithium Niobate, Silicon Nitride, etc.)
Indium Phosphide (InP) is the most preferred raw material used in photonic integrated circuits. In 2014, Indium Phosphide accounted for around one-third of the global market revenue. It is expected to remain the most preferred raw material used for photonic integration during the 2015 – 2022. The dominance of Indium Phosphide can be attributed to its ability to integrate active and passive optical functions onto one single material substrate. In addition, other benefits offered in terms of cost, reliability, and energy efficiency make Indium Phosphide a preferred raw material for photonic integration. Other raw materials, including silicon and silicon-on-insulator, are also widely used in photonic integrated circuits because of the low cost, easy availability, and simple fabrication. To merge multiple optical components/functions into a single package and make electronic devices compact, photonic integration is necessary.
Based on the integration technique, the global photonic IC market is segmented into the following categories
- Monolithic Integration
- Hybrid Integration
- Module Integration
Hybrid integration is the chief integration technique used for photonic integration. In 2014, the hybrid integration technique accounted for over half of the global market revenue share. Although it is expected to remain the major photonic integration technique, the monolithic integration method is expected to witness maximum adoption, growing at a CAGR of 25.7% from 2015 – 2022. The anticipated growth can be credited to its capability to integrate both medium and large-sized photonic integrated circuits.
Furthermore, superior benefits in terms of reliability, power efficiency, and testing has convinced manufacturers across the globe to increasingly employ monolithic integration technique. Module integration is another technique employed for photonic integration. It accounted for the least revenue share in 2014. Over the forecast period 2015 – 2022, it is expected to exhibit sluggish growth. The inability to merge a large number of optical functions and low fiber coupling integration offered as compared to other techniques is seen as the major roadblock in the widespread use of module integration techniques.
On the basis of application, the photonic integrated circuits (PIC) market is categorized into the following segments:
- Optical Communication (Wireless Access Networks, Long Haul, Transport Networks, Data Centers, etc.)
- Sensing (Engineering, Energy and Utilities, Transport and Aerospace, etc.)
- Biophotonics (Medical Devices, Photonic Lab-On-A-Chip, etc.)
- Optical Signal Processing (Quantum Optics, Quantum Computing, Optical Metrology, etc.)
The optical communication segment covering wireless access networks, long haul, and transport networks, and data center applications was the largest application segment in the global photonic integrated circuits (PIC) market, accounting for over 50 percent of the market revenue in 2014. Over the forecast period 2015 – 2022, the segment is anticipated to remain the largest contributor to the global photonic integrated circuits market (PIC), majorly supported by the escalating demand for high-speed communication in wireless access networks and data center applications. Other major application fields include sensing and biophotonics.
Photonic technology has revolutionized the healthcare industry, offering a reliable means to detect, treat, and/or prevent disease early. Optical signal processing is another potential application field for photonic ICs. The optical signal processing segment is estimated to witness maximum growth among all other application fields during the 2015 – 2022. The anticipated growth can be attributed to the expected commercialization of quantum computing during the forecast period.
The notion of photonic integration finds its roots in the second half of the twentieth century. The potential of photonic integration and photonic integrated circuits (PIC) went untapped and unfulfilled for a number of decades. Lack of technology development and penetrative application products were the major factors responsible for the same.
The photonic technology had little evolved until advanced photonic integrated circuits capable of incorporating many active components were introduced. This development has been instrumental in stirring the photonics industry. After a long period of sluggish development and penetration, the evolution of photonic integrated circuits and techniques finally received the necessary push. The technology has attained commercial growth in recent years, enabling energy-efficient and high bandwidth transceivers in data centers and telecom networks.
Electronic integrated circuits have an evolutionary head-start of over three decades and hence outnumber photonic integrated circuits. However, considering the benefits offered by photonic ICs, industry experts have predicted that almost all electronic integrated circuits are expected to be replaced by photonic integrated circuits over the next decade. The industry experts have neither taken down the possibility of optics and electronics integration in the future. The following table represents the comparison between photonic integrated circuits and electronic integrated circuits.
One of the major differences between an electronic integrated circuit and a photonic integrated circuit is the type of raw material used for its manufacturing. In photonic integrated circuits, the material used primarily depends upon the specific function of the device. In contrast, in the case of electronic integrated circuits, silicon is the chief raw material used. Therefore, depending upon the specific function of the device, different raw materials, including Indium Phosphide, Gallium Arsenide, Lithium Niobate, Silicon, and Silicon-on-Insulator, are used for PIC fabrication. However, there lies a similarity in the fabrication technique (photolithography) used by both electronic ICs and photonic ICs.
While there is no particular dominant device in photonic integrated circuits, transistors are primary devices in electronics. Furthermore, while electronic integrated circuits function in digital mode, photonic integrated circuits are analogous to electronic integrated circuits. Therefore, digitization is crucial for reducing the complexity of circuitry and attaining a high level of integration.
In addition to the distinctions mentioned above, electronic integrated circuits also differ from photonic integrated circuits in the data carriers used and hence the data transfer rate. Electronic integrated circuits use electrons as data carriers, while photonic integrated circuits use photons. Since photons travel at the speed of light, photonic integrated circuits can transfer data at a faster rate as compared to electronic integrated circuits.
In terms of revenue, North America (comprising the U.S. and the Rest of North America) represented the largest photonic IC market, accounting for over 35 percent of the global revenue share in 2014. The U.S. represents the largest and the most lucrative photonic IC market worldwide. The photonic IC market in North America is driven by the increasing penetration of photonic technology in fiber optic communication, especially data center applications and wireless access networks.
In addition, the presence of many photonic device manufacturers and continual research in photonics has further cemented its leading position. Although North America is expected to remain the largest photonic IC market over the forecast period of 2015 – 2022, Asia Pacific is expected to witness maximum growth, growing at a CAGR of 26.3%. The anticipated growth in the region is expected to be driven by the escalating demand from data centers and biophotonics applications during the forecast period 2015 – 2022.
