Silicon Photonics Market Trends

Growth Drivers

• Rapidly Growing Industry 4.0 - In the period 2011-2021, start-ups involved in Industry 4.0 received an increase of +335% in funding annually. In 2021, USD 2 billion was invested in upcoming companies developing Industry 4.0 technology. As of 2021, 130 acquisitions related to Industry 4.0 were made annually. The emergence of Industry 4.0 technologies, such as artificial intelligence, the Internet of Things, and 5G, are driving the need for faster, more reliable data transmission. Silicon photonics addresses these needs by providing a more efficient data transmission method using light instead of electrical signals, making it the ideal solution for the Industry 4.0 era.

• Increasing Adoption of Internet Of Things (IoT) Devices Across Various Industries- According to the current estimates, there are currently 7 billion IoT devices in operation, and with the rapid introduction of 5G and other technologies, this number is expected to grow by over three times, reaching 25.44 billion total devices by 2030. IoT devices generate and transmit a large amount of data, which requires high-speed communication networks and bandwidth. Silicon photonics is a more efficient way to transfer this data than traditional copper-based communication networks.

• Rising Demand from Telecommunication Sector- The use of silicon photonics is increasing with the rapid growth of telecom services. India has a telecommunications density of 85%, total broadband subscriptions reached 787 million in April 2022, and there were 1.13 billion subscribers in April 2022. Silicon photonics combines the functionality of electronics and optics on a single chip, enabling the transmission of data at faster speeds over longer distances with less power. This makes it an ideal technology for telecom services, which require high-speed transmission and reliable performance.

• Increasing Use of Consumer Electronic Products Such as Laptops And Smartphones - Globally, five billion people are connected to the internet every day, and 66% of those people use a laptop to access the internet. Over 341,000 PCs were shipped worldwide in 2021, representing a 14.6% annual growth rate. Also, there are 6.4 billion smartphone subscriptions worldwide.

• Emerging New Generation of Devices Powered by Artificial Intelligence (AI) - Statistics show that 96% of mobile users use AI-powered voice assistants. In the past year, over 3 billion devices have been equipped with voice assistants powered by artificial intelligence. AI-powered devices are expected to revolutionize the way data is processed and transmitted. This has resulted in increased demand for silicon photonics, as it is more efficient and cost-effective for data processing and transmission than traditional methods.

Challenges

• Difficulties in integrating photonics with the existing electrical components - Photonics and electrical components operate on different principles, so integrating them can be challenging. For instance, photonics use light to carry signals, while electrical components use electrical signals. This means that they need to be carefully designed to be compatible with each other, which can be difficult and costly.

• High cost associated with the development

• Manufacturing of silicon photonics-based products