Omdia: Next-generation PON equipment market to reach nearly $8.9 billion in 2025

LightReading reported that Omdia pointed out in its report titled "Trends Worth Watching in 2021: Broadband Access Equipment Market" that as governments around the world have taken lockdown measures to fight COVID-19 and the promotion of vaccines will take time, working from home and online learning will remain the norm. Driven by this, the broadband access equipment market will continue to maintain an upward trend in 2021.

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The next-generation PON, with 10G PON as the main product form, is growing rapidly, and 25G PON that supports 5G wireless network midhaul and backhaul will also gain more market attention.

“COVID-19 and geopolitical dynamics will continue to drive the broadband access equipment market in 2021,” said Julie Kunstler, senior principal analyst at Omdia. “In particular, suppliers outside of China will have more opportunities to enter the PON-based FTTH infrastructure supply chain.”

The United States has taken seemingly successful actions to get its allies to sign the "Clean Network" policy to suppress Huawei and ZTE. Subsequently, more and more operators, especially in North America and Western Europe, are replacing network equipment from Chinese suppliers. The report said that starting this year, the trend of smaller suppliers winning contracts previously won by Chinese suppliers will continue into 2021.

According to Omdia's calculations, by the second quarter of 2020, the number of next-generation PON OLT port shipments was close to 830,000, a year-on-year increase of 70%. COVID-19 has accelerated the deployment pace of operators, and Omdia expects continued growth next year, while the upgrade from GPON (2.5G) to 10G PON will accelerate. The analyst firm said that by 2025, most GPON ONT/ONU will be 10G-capable, and revenue from next-generation PON equipment is expected to approach $8.9 billion by then.

In addition, as cable operators begin to adopt virtualized, distributed access architectures, revenue from next-generation cable broadband access equipment will rise in 2021 and reach nearly $1.2 billion by 2025.

In addition to providing greater capacity, 10G PON business application scenarios also enable the reuse of GPON infrastructure for different scenarios, such as transmission of small and medium-sized enterprises, smart cities, and 5G small base stations.

"Network reuse can bring higher return on investment for communications service providers." Omdia pointed out that as operators adopt 10G wired and 5G wireless service strategies, fixed-mobile convergence (FMC) will soon become a "reality." In addition, non-residential 10G PON revenue is also growing.