The global VCSELs market is predicted to reach $6.96 billion by 2030, witnessing a CAGR of 18.6% during 2021–2030. The growth can be ascribed to the rising investment in manufacturing of VCSELs, burgeoning application of these devices in data communication, and growing adoption of 3D sensors in consumer electronic devices.
Vertical-cavity surface-emitting lasers, a kind of semiconducting laser diodes, are widely employed in optical communications to prevent transmission loss. VCSELs are a cost-effective optical source over edge-emitting lasers (EEL) and LEDs in sensing and imaging applications.
Moreover, they have an array of benefits, including higher optical efficiency, lower cost, stable wavelengths, low power consumption, and greater modulation rates.
Based on end user, the consumer electronics is dominating the industry with more than 42.5% market share in 2021. This dominance can be ascribed to the advances in digital technology and rise in the demand for consumer electronics in emerging economies. The increasing integration of augmented reality, 3D facial recognition, proximity sensors, and laser-based autofocuses into consumer electronics has resulted in a surge in the global demand for these products. 3D sensing and facial recognition are made possible by vertical-cavity surface-emitting lasers, which is why these components are typically utilized for visual imaging and 3D sensing in smartphones and tablets.
The global network of data centers has increased due to the rising internet traffic and digital data production. Many data center optical communication components are built with VCSELs and multi-mode fibers. Because of their high-speed data transfer ability, excellent durability, and low power consumption, VCSELs are employed as optical transceivers, enabling data analysis applications to improve decision-making skills.
Optical transceivers based on vertical-cavity surface-emitting lasers are also utilized for intra-data center communications, to enhance carrier and optical mode overlaps. They are mostly employed in next-generation data communication applications, because they allow for ultra-high bit rates, while also extending the reach of multi-mode fibers. As a result, the need for high-speed data transmission has increased the demand for VCSEL arrays in data centers.
Additionally, major tech giants, such as Apple, Microsoft, Google, Facebook, and Amazon, all employ hyperscale data centers for cloud computing and high-volume data storage. Hyperscale data centers assist businesses in designing high-density server racks, to improve operations and reduce power usage. They protect data, including personal and financial information, in order to reduce the danger of cyberattacks. The rise of hyperscale data centers has, thus, increased the demand for arrays and multi-mode fibers for data transmission and exchange.
Asia-Pacific is predicted to grow at the highest CAGR during the forecast period owing to the large-scale industrialization in this region. Most of the major overseas industry players have created subsidiaries or branches in emerging economies, such as India, China, Indonesia, and Vietnam, to take advantage of the inexpensive labor. Another element boosting the demand for these products in this region is the increasing adoption of industrial automation, as well as computers, LED displays, and telecommunication devices. Furthermore, the rise in the demand for oil and gas has fueled the demand for hydrocarbon sensing devices, which will bolster product sales in the coming years.
The key players operating in the VCSELs market are TRUMPF SE + Co. KG, Coherent Corp., Lumentum Operations LLC, Hamamatsu Photonics K.K., Vixar Inc., TT Electronics Alight Technologies, Vertilite, MKS Instruments, and Leonardo Electronics.