DWDM Revolution: $18bn Investment Unleashed

The market revenue for DWDM (Dense Wavelength Division Multiplexing) equipment is expected to reach $18 billion by 2028, according to a report by Dell'Oro. This growth is primarily driven by the entry of coherent DSPs (Digital Signal Processors) capable of delivering speeds over one terabit-per-second.

"We are projecting that the new generation of coherent DSPs, capable of terabit speeds, will experience accelerated growth over the next five years," says Jimmy Yu, Vice President at Dell'Oro. "By 2028, we anticipate that over half of the DWDM market revenue will come from shipments of 1.2 Tbps and 1.6 Tbps-capable line cards. These line cards will enable the deployment of 400 Gbps wavelengths in ultra-long-haul applications spanning thousands of kilometers, and 800 Gbps wavelengths in other areas."

The demand for DWDM Long Haul equipment is expected to grow at a faster pace compared to Metro equipment, contributing a higher share of market revenue in the future. The shipment of coherent wavelengths capable of terabit-per-second speeds is projected to grow at a compound annual growth rate (CAGR) of 200 percent over the next five years.

Furthermore, baud rates over 100 GHz are predicted to surpass 40 percent of new installations by 2028. Although higher baud rates reduce the total number of wavelengths per fiber, they offer better performance and longer reach while also reducing costs.

In conclusion, the DWDM equipment market is set to experience significant growth in the coming years, driven by the introduction of coherent DSPs capable of delivering terabit speeds. The demand for Long Haul equipment is expected to outpace Metro equipment, and the shipment of coherent wavelengths is projected to grow rapidly. Additionally, the adoption of higher baud rates will enhance performance and reduce costs in the DWDM industry.