UBM Tech
UBM Tech

APAC leads fiber-optic test equipment market

-April 29, 2013

Fiber-optic communication is becoming the future of every network or communication. An all-optic network is going to be the framework of any industry. Additionally, fiber also has excellent properties, including a smaller diameter, anti-electromagnetic interference and radiation properties of atoms, a light weight, insulation, and resistance to nuclear radiation. Fiber-optic testing is critical and fiber-optic test equipment (FOTE) plays a major role in the handling of the networks.  FTTx has grown from its initial FTTN (fiber to the node) to FTTB (fiber to the building) to FTTC (fiber to the curb) and now to FTTH (fiber to the home). Beyond general fiber-optic testing, fiber inspection is taking up a higher position in the test market.
Market Trends:

With plans to reach 100Gb/s bandwidth speed, it is essential for growth of the FOTE market to ensure delivery of low-cost fiber-optic components, devices, and systems, while maintaining the need for more bandwidth. Key trends and factors to be considered for the growth of this market include technology growth, higher bandwidth, cost reduction, and all-optical networks. With increases in bandwidth demand, fiber is expected to play a major role in the long-term success of telecommunications. With all the probes available, test vendors are able to provide more initiatives to testing and more value to end users.

Product Portfolio:
The global fiber optic test equipment (FOTE) market is segmented into the following product segments namely:
  • Optical time domain reflectometers (OTDR)
  • Optical light source (OLS)
  • Optical power meter (OPM)
  • Optical loss test set  (OLTS)
  • Remote fiber test systems (RFTS)
  • Optical spectrum analyzer (OSA)
  • Others:
  • Polarization mode dispersion (PMD)
  • Tunable laser (TL)
  • Coarse wavelength division multiplexing (CWDM)
  • Dense wave division multiplexing (DWDM)
  • Chromatic dispersion (CD)

There is an increased use of fiber inspection probes (FIP), visual fault locators (VFL) and live fiber detectors (LFD). The growth in the FOTE market is spurred by the need for real-time analysis and in turn next-generation FOTE. User-defined protocol with use of FPGA is a key area of growth specifically from a modular FOTE standpoint.

There is an increasing demand to perform testing at higher rates with an increase in customer demand. At this stage, there are some customers that still do not perform sufficient amount of testing in some scenarios of high-speed digital interfaces. This is expected to change with improvement in technology and powerful bit error rate testers. High speeds of 40 Gb/s and 100 Gb/s are two major factors boosting market growth from a technological perspective.

Geographic Analysis:

The various regions covered under the FOTE market include:
  • North America (NA): Canada and the United States
  • Europe (EU): Western, central, and eastern Europe and Russia
  • Asia-Pacific (APAC): Countries that are on the western border of the Pacific Ocean (including those on the Indo-Chinese peninsula), the Pacific Islands, and Central Asia
  • Emerging Regions: Central and South America, the Caribbean islands, Middle East, Africa, and regions not mentioned above

NA leads the way with 4G deployments already in full stream with several tier-1 service providers offering high-speed Internet service to their customers. An integrated test equipment presence and importance is growing on a daily basis. Providing integrated fiber-optic functionality in field deployments adds tremendous value, as the technician can use a single tester to perform several tests.

Testing in Europe is in a chicken-and-egg syndrome, especially during the current economic turmoil although it has subsided a lot. Companies aren’t sure about whether they should test their networks first or perform tests after network deployment. Due to the CAPEX issues, testing is not taken seriously by some companies, leading to hindrance of market growth. There is also slow progress on the adoption of superfast broadband, leading to a halt in technology deployment. The advent of mobile backhaul and the new technology WDM-PON is also expected to happen slowly due to the lack of commitment.

From an Asia Pacific perspective, China is expected to have regulatory policies in place for the deployment of FTTH. With the increase in sales of smartphones and gaming, there is a lot of potential for fiber-optic growth in this region. Fiber to the “last mile” is expected to lure vendors to develop innovative solutions and address all end-user needs and requirements.

Countries including Korea, Japan, India, Indonesia, and China are expected to increase FTTH deployment. Communication service providers are increasingly expected to use the advent of new technologies such as 4G services, thereby installing more fiber-optic cable and, in turn, raising the bar for more FOTE.

There are more opportunities for growth as more telecom providers are expected to go the fiber-optic route in emerging countries of the world. As more fiber cables are laid out, the need for testing is also expected to rise. Import regulations and heavy taxes are hindering certain global vendors from increasing their sales volume in these parts of the world. Some countries, such as Brazil, impose several import duties that might increase the pricing pressure for global vendors attempting to sell in these regions. Hence, regional vendors have the advantage to gain more profits as against their global peers.

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