The fiber-to-the-x market will more than triple from the years 2001 to 2005 and more than double in the following four-year period to reach $5.9 billion by 2009, according to a new report being published by Chaffee Fiber Optics.
Fiber-to-the-x is what Chaffee Fiber Optics describes as fiber-to-the-home, fiber-to-the-building, fiber-in-the-building, and fiber-to-the-cabinet. This market space will represent an important factor in the optical fiber industry's turnaround and subsequent renewal, particularly from the second half of 2003 onward, according to the report.
The report, "Fiber to The x: 2001-2010-New Paradigm for Success in a Changing Industry," is based on information obtained from dozens of interviews with both carriers and vendors using standardized questionnaires and fact checking with industry experts. It projects that by far the largest portion of that growth in real dollars will be in the fiber-to-the-building/fiber-in-the-building market, which will grow from $512.7 million this year to $1.853 billion in 2005 and $3.264 billion in 2009. Seven percent of U.S. office buildings are now wired with fiber as are 11% of buildings in Japan. Both numbers will increase appreciably during the next decade.
The report states that the largest growth percentage-wise will occur in the fiber-to-the-home market, accelerating by more than 20-fold in the eight-year period from $23.2 million in 2001 to $547.9 million in 2009.
The report also states that the fiber-to-the-cabinet market will grow from $178.6 million in 2001 to $627 million in 2005 and $1.287 billion in 2009.
The fiber-to-the-building/fiber-in-the-building and fiber-to-the-cabinet markets are now in their first definitive phase of being commercial markets, the report says. As such, both markets will continue to grow for the foreseeable future as photonics replaces electronics in those networks.
Large businesses make up the vast majority of the market at this time, primarily because they see the ability to have unlimited bandwidth as a corporate enabler and generally are in the best position to pay for it. However, some vendors already are laying a path so that medium-sized and smaller-sized businesses also can take advantage of the larger bandwidth that optical fiber offers. Chaffee Fiber Optics sees that trend growing throughout the studied time period.
The report found that the fiber-to-the-home market is connected to, but lagging, the fiber-to-the building market. It is related in that optical fiber component and system price drops needed to accelerate the fiber-to-the-building market will have to be even more pronounced for the fiber-to-the-home market to take off. The fiber-to-the-home market is potentially by far the largest.
Chaffee Fiber Optics believes the handoff that makes the most sense is to go from fiber-to-the-business to fiber-to-the-large-multiple-dwelling-residential-unit such as condominiums or apartments. The economics necessarily are similar and expenditures that bog down fiber to the home economics such as large and costly fiber installations to sparsely located areas are avoided.
Most of the growth will begin in the second half of 2003 as the industry rebounds from the current market downturn.
The long-haul optical fiber market has pushed the industry for the first 20 years of its existence. This is changing as more attention is focused on relieving the current bottleneck that does not allow the enormous pipes spread throughout the network to provide the full bandwidth possible to the home and office. This access market eventually will be substantially larger than the long haul fiber market, the report says.
For more information or a copy of the report, contact Chaffee Fiber Optics at 410-750-1406 or send email requests to [email protected] or Chaffee Fiber Optics, 3611 Morning View Court, Ellicott City, MD 21042.
