Passive Optical Network (PON) - A Fiber to Premises (FTTP) Network Structure

The global passive optical network (PON) equipment market will expand at a phenomenal 20.70% CAGR from 2015 to 2023. Some of the advantages of PON equipment are – high return on investment, reliability, low cost of ownership, and advanced security and facile network operations. Presently, Asia Pacific holds immense opportunities for the growth of the PON equipment market; high investments for the development of telecommunications research infrastructure and overall technological advancements for expeditious services are the reasons to this. In 2014, Asia Pacific was ahead of the other regional segments – North America, Europe, and Rest of the World (RoW) – and held more than 35% of the global PON market.

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Design and Application Analysis of Passive Optical Network Equipment

Typically, PON equipment is installed on PON network structure that counts as one of the two important systems for the feasibility of fiber to the premises (FTTP) solutions. In these networks, optical splitters are used for a single fiber to transmit information to multiple premises. The structure of the passive optical network – more precisely, whether it is an Ethernet passive optical network (EPON) or a gigabit passive optical network (GPON) – decides the split ratio of these networks. Regarding the design aspects of PON and its parent FTTP network structures, a solitary optical line terminal at the service provider’s site is complemented by numerous optical network units in proximity to the end users.

Gigabit passive optical networks employ GPON devices suitable for high-speed video streaming, data, and voice services for both residential and business subscribers. The high bandwidth of GPON is further strengthened by the reliability and long-reach connectivity of these networks. In terms of utilization, GPON has been tremendously beneficial for defense services due to the advanced network security and high bandwidth of these networks.

On the other hand, EPONs help service providers deliver broadband and enterprise services, voice and IPTV services, and time division multiplexing (TDM). The usability of EPON also lies in mobile backhaul carriage services for 3G and 4G data networks. In addition, Ethernet networking solutions do not require protocol conversions, which count for their high usability in metro-area networks (MANs) and local area networks (LANs). To serve these advanced networks, EPON equipment is evolving continually to be compatible with existent Ethernet standards.

GPON Structural Networks Advantageous over Ethernet PONs

The global passive optical network equipment market is divided on the basis of component, structure, and geography. The component segments of the market are optical cables, optical filters, optical power splitters, and wavelength division de-multiplexers/multiplexers. Of these, wavelength division de-multiplexer/multiplexers constituted the dominant segment and accounted for almost 50% of the global market in 2014.

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 On the basis of structure, gigabit passive optical networks and Ethernet passive optical networks are the segments of this market. Of the two, in 2014, GPON accounted for the larger contribution to the global PON market. The segment held more than 65% of the overall market due to its high deployment in government enterprises and corporate projects. GPON also provides higher bandwidth, advanced security, and larger downstream speed than EPON, which are collectively contributing to the increasing adoption rate of GPON equipment.

Split Ratio of Passive Optical Network Depends on its Usage

Passive optical network (PON) is a fiber to the premises (FTTP) network structure. The goal of the network is to provide a solution which is easy to install, maintain and upgrade. This is done by using optical splitters in PON which enables a single fiber to deliver services to multiple premises. PON comprises an optical line terminal at the site of the service provider and numerous optical network units near end users. It is considered an eco-friendly alternative vis-à-vis conventional network, due to usage of unpowered optical splitters.The split ratio of passive optical network depends on its usage in terms of its structure such as Ethernet passive optical network (EPON) and Gigabit passive optical network (GPON).

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GPON devices provide high-speed video, data and voice services to residential and business subscribers. Reliability and long-reach connectivity further strengthens the extremely high bandwidth of GPON technology. It also reduces the number of active switching devices implemented in a computer network. Moreover, GPON has been a major advancement for defense services, primarily due to advanced security and high bandwidth provided by the network.

EPON assists service providers to deliver voice and IPTV services, broadband and enterprise services, such as voice and internet connectivity and time division multiplexing (TDM). In addition, 4G and 3G mobile backhaul carriage services are also provided by EPON. With advancement in technology, new EPON equipment having full compatibility with the existing Ethernet standards are being developed continuously. As Ethernet is the major networking solution used in local area networks (LANs) and metro-area networks (MANs), protocol conversions are not required.

ONT as well as OLT are used in both GPON and EPON. OLT is placed at the service provider's central site, while the ONT at the premises of end users. The OLT operates as the Local Area Network (LAN) - combination element for assimilating video, voice and data services into a particular fiber structure. The ONT provides different local service interfaces to the user, such as video, telemetry, voice and data. GPON offers secure, high bandwidth and scalable networks for military, business and campus applications by leveraging influence of fiber optics and internet protocol/Ethernet architecture.

Passive optical network equipment market was valued at US$24.81 bn in 2014, at a CAGR of 20.7% from 2015 to 2023 to account for US$163.5 bn in 2023. The major driving factors of the global passive optical network equipment market are low cost of ownership and the high return on investments. In addition, higher bandwidth, unmatched security and greater reliability are set to bolster the growth of PON globally. Moreover, increasing digitization, coupled with mass adoption of smart and connected digital devices by businesses, governments and consumers is set to boost the growth of this market. Increasing advancements in networking technologies coupled with growing awareness regarding eco-friendly solutions in Asia Pacific is expected to create significant opportunity for the growth of PON equipment market in the future. However, high initial investments and high component cost at operator’s interface is set to restrain the growth of the market.

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GPON Structural Networks Advantageous over Ethernet PONs

 In 2014, GPON accounted for the larger contribution to the global PON market. The segment held more than 65% of the overall market due to its high deployment in government enterprises and corporate projects. GPON also provides higher bandwidth, advanced security, and larger downstream speed than EPON, which are collectively contributing to the increasing adoption rate of GPON equipment.

Design and Application Analysis of Passive Optical Network Equipment

 Passive Optical Network Equipment Market

Passive optical network (PON) is a fiber to the premises (FTTP) network structure. The goal of the network is to provide a solution which is easy to install, maintain and upgrade. This is done by using optical splitters in PON which enables a single fiber to deliver services to multiple premises. PON comprises an optical line terminal at the site of the service provider and numerous optical network units near end users. It is considered an eco-friendly alternative vis-à-vis conventional network, due to usage of unpowered optical splitters. GPON devices provide high-speed video, data and voice services to residential and business subscribers. Reliability and long-reach connectivity further strengthens the extremely high bandwidth of GPON technology. It also reduces the number of active switching devices implemented in a computer network. Moreover, GPON has been a major advancement for defense services, primarily due to advanced security and high bandwidth provided by the network.

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EPON assists service providers to deliver voice and IPTV services, broadband and enterprise services, such as voice and internet connectivity and time division multiplexing (TDM). In addition, 4G and 3G mobile backhaul carriage services are also provided by EPON. With advancement in technology, new EPON equipment having full compatibility with the existing Ethernet standards are being developed continuously. As Ethernet is the major networking solution used in local area networks (LANs) and metro-area networks (MANs), protocol conversions are not required.

ONT as well as OLT are used in both GPON and EPON. OLT is placed at the service provider's central site, while the ONT at the premises of end users. The OLT operates as the Local Area Network (LAN) - combination element for assimilating video, voice and data services into a particular fiber structure. The ONT provides different local service interfaces to the user, such as video, telemetry, voice and data. GPON offers secure, high bandwidth and scalable networks for military, business and campus applications by leveraging influence of fiber optics and internet protocol/Ethernet architecture.

Global Passive Optical Network Equipment Market was valued at US$24.81 bn in 2014, at a CAGR of 20.7% from 2015 to 2023 to account for US$163.5 bn in 2023.

Global passive optical network (PON) equipment market: by components

> Optical cables

> Optical power splitters

> Optical filters

> Wavelength division multiplexer/de-multiplexer

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Global passive optical network (PON) equipment market: by structure

> Gigabit passive optical network (GPON)

> Ethernet passive optical network (EPON)

Global gigabit passive optical network (GPON) equipment market: by components

> Optical Network Terminal (ONT)

> Optical Line Terminal (OLT)

Global Ethernet passive optical network (EPON) equipment market: by components

> Optical Network Terminal (ONT)

> Optical Line Terminal (OLT)

 Key players have also been profiled on the basis of company overview, financial overview, business strategies and key developments. Major market participants profiled in this report include Huawei Technologies Co. Ltd., Alcatel-Lucent S.A., ZTE Corp, Calix Inc., Ericsson Inc., Adtran Inc, Freescale Semiconductor Inc., Motorola Solutions Inc., Mitsubishi Electric Corporation and Verizon Communications Inc.