New Analysis from Global Industry Analysts Reveals Steady Growth for Photonic Integrated Circuit (PIC), with the Market to Reach $2.9 Billion Worldwide by 2026

SAN FRANCISCO, March 1, 2022 /PRNewswire/ -- A new market study published by Global Industry Analysts Inc., (GIA) the premier market research company, today released its report titled "Photonic Integrated Circuit (PIC) - Global Market Trajectory & Analytics". The report presents fresh perspectives on opportunities and challenges in a significantly transformed post COVID-19 marketplace.

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Edition: 18; Released: February 2022
Executive Pool: 5011
Companies: 84 - Players covered include Broadcom Inc.; Ciena Corporation; Enablence Technologies, Inc.; Infinera Corporation; Intel Corporation; Lumentum Operations LLC; NeoPhotonics Corporation; Nokia Networks and Others.
Coverage: All major geographies and key segments
Segments: Technique (Hybrid Integration, Monolithic Integration, Module Integration); Raw Material [Indium Phosphide (InP), Silicon-on-Insulator (SOI), Gallium Arsenide (GaAs), Silicon (Si), Other Raw Materials]; Application (Optical Communications, Optical Signal Processing, Other Applications)
Geographies: World; USA; Canada; Japan; China; Europe; France; Germany; Italy; UK; Spain; Russia; Rest of Europe; Asia-Pacific; India; South Korea; Taiwan; Rest of Asia-Pacific; Latin America; Brazil; Mexico; Rest of Latin America; Rest of World.

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ABSTRACT-

Global Photonic Integrated Circuit (PIC) Market to Reach US$2.9 Billion by the Year 2026
Photonic Integrated Circuit (PIC), also referred to as integrated optical circuit or simply optical chip, is a semiconductor device that is designed to combine or integrate multiple optical elements on one single chip. The market is projected to register significant growth driven by the growing interest in the ability to exploit the properties of light to transmit information at speeds millions of times faster than either copper or laser, especially against the backdrop of the insatiable need for bandwidth and communication speeds. The growing opportunity in optical communications and improving investments post COVID-19, bodes well for the growth of PICs. While sustained high growth in the deployment and expansion of communication networks with fiber optic infrastructure is building strong momentum for PICs, increased use of fiber optics in signal transmission, sensing, and biophotonics is creating a highly conducive environment for growth and proliferation of PICs, on a wider scale. The dramatic growth in telecom and datacom verticals over the past 5-6 years driven by steep increase in the number of Internet users and ownership rates of IP-enabled devices, and subsequently growing investments on roll out of advanced communication networks such as 100G, 200G and 400G networks is infusing robust growth opportunities for PICs.

Amid the COVID-19 crisis, the global market for Photonic Integrated Circuit (PIC) estimated at US$1.2 Billion in the year 2022, is projected to reach a revised size of US$2.9 Billion by 2026, growing at a CAGR of 21.7% over the analysis period. Hybrid Integration, one of the segments analyzed in the report, is projected to grow at a 20.2% CAGR to reach US$1.7 Billion by the end of the analysis period. After a thorough analysis of the business implications of the pandemic and its induced economic crisis, growth in the Monolithic Integration segment is readjusted to a revised 25.5% CAGR for the next 7-year period. This segment currently accounts for a 29.7% share of the global Photonic Integrated Circuit (PIC) market. Monolithic integration is steadily gathering steam as a major integration model for PIC assembly. Hybrid integration represents the most widely used integration model for PICs. The hybrid integration of PIC facilitates assembly of multiple mono-function optical devices into one common package. Monolithic integration typically allows consolidation of multiple devices as well as functions into one common Photonic material in a more convenient manner than packaging or hybrid integration.

The U.S. Market is Estimated at $463.8 Million in 2022, While China is Forecast to Reach $385.3 Million by 2026
The Photonic Integrated Circuit (PIC) market in the U.S. is estimated at US$463.8 Million in the year 2022. The country currently accounts for a 38% share in the global market. China, the world's second largest economy, is forecast to reach an estimated market size of US$385.3 Million in the year 2026 trailing a CAGR of 34.5% through the analysis period. Among the other noteworthy geographic markets are Japan and Canada, each forecast to grow at 16.2% and 18.7% respectively over the analysis period. Within Europe, Germany is forecast to grow at approximately 18.4% CAGR while Rest of European market (as defined in the study) will reach US$522.7 Million by the end of the analysis period. Increased demand for integration in smart gadgets and favorable regulatory environment for expansion of medium and small size companies is expected to encourage growth in both Asia-Pacific and the US.

Module Integration Segment to Reach $415.7 Million by 2026
Module integration refers to integration of discrete devices and package into one common module. Module integration for PIC allows integration of different optical functions and materials, and also combining the PIC and electronic IC functions in a seamless manner. In the global Module Integration segment, USA, Canada, Japan, China and Europe will drive the 18.5% CAGR estimated for this segment. These regional markets accounting for a combined market size of US$128.2 Million will reach a projected size of US$397.4 Million by the close of the analysis period. China will remain among the fastest growing in this cluster of regional markets. Led by countries such as Australia, India, and South Korea, the market in Asia-Pacific is forecast to reach US$33.7 Million by the year 2026, while Latin America will expand at a 21.7% CAGR through the analysis period.

Challenges with PIC Production
Potential uses of photonic integrated circuits are increasing at a steady rate. Applications like optical communications in data centers, interrogators for FBG sensors, and solid state LiDAR are anticipated to increase demand for PICs significantly. However, even though the technology of PIC resembles to a significant extent, the technology of semiconductor electronics, there are still small differences that demand changes in PIC production equipment. A few front end-challenges that have been identified are optimized lithography tools and thin films. There are also a few challenges at the back-end. Around 80% of PIC costs are for back-end operations including assembly and multiple chip packaging. Challenges here exist in the areas of alignment and in dealing with low volume and high mix. There is also no standardization for PIC manufacturing currently, which poses another challenge. Standardization is required for successful automation of photonic factory production in the future. However, factory automation would not be seen as the primary development required by the industry, at least for the present because immediate developments must aim at smaller manufacturing settings. Full-fledged implementation of Industry 4.0 is also not yet required.

PICs offer certain unique challenges even in metrology. Photonic and electrical features need to be simultaneously measured and these include photonic circuits' visual inspection with patterns that are different from those common in semiconductors; in-line measurements (optical circuits which are basically end-emitting pose a challenge here); combination of optical and high frequency measurements; lack of probes for combined photonic and electrical testing; and longer measurement cycles, more so for optical tests. More

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About Global Industry Analysts, Inc. & StrategyR™
Global Industry Analysts, Inc., (www.strategyr.com) is a renowned market research publisher the world`s only influencer driven market research company. Proudly serving more than 42,000 clients from 36 countries, GIA is recognized for accurate forecasting of markets and industries for over 33 years.

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