At 6.9% CAGR, South & Central America Pluggable Optics for Data Center Market is Projected to be Worth US$ 498.46 Million by 2031, Says Business Market Insights

According to Business Market Insights' research, the South & Central America pluggable optics for data center market was valued at US$ 291.63 in 2023 and is expected to reach US$ 498.46 million by 2031, registering a CAGR of 6.9% from 2023 to 2031. Linear pluggable optics and demand for pluggable optics in high-performance AI infrastructure are among the critical factors attributed to the South & Central America pluggable optics for data center market expansion.

Linear pluggable optics (LPO) are optical transceivers that do not include digital signal processor (DSP) chips. They rely on simpler signal modulation techniques and basic electronic components. This results in lower power consumption and production costs compared to DSP-based solutions. This simplicity also results in lower latency, making LPOs suitable for high-speed environments. LPO modules are increasingly being used in modern data centers, and they are becoming essential components of co-packaged optics (CPO) and near-package optics (NPO) solutions. These applications benefit from direct, short connections between ICs and LPO optical modules, which maximize the efficiency gains provided by LPO technology.

Lower power consumption, reduced bill of material (BOM) components, and minimal latency features of LPOs are expected to fuel their demand in the coming years. In addition, mega data centers widely adopt LPO, and it works great for latency-sensitive applications in AI and ML and enhances network performance. To cater to this market, the market players are launching solutions, which contributes to the market growth.

 In March 2024, the Linear Pluggable Optics Multi-Source Agreement (LPO MSA) was formed by a group of networking, semiconductor, and optics companies to develop specifications for networking equipment and optical modules that will enable a broad ecosystem of interoperable LPO solutions. Accelink, Arista, AMD, Broadcom, Eoptolink, Hisense, Cisco, Innolight, MACOM, Intel, NVIDIA, and Semtech are the founding members of the LPO MSA. Such consortium to define LPO specifications drives the pluggable optics market.

On the contrary, rising network complexity hampers the growth of South & Central America pluggable optics for data center market.

Based on component, the South & Central America pluggable optics for data center market is segmented into switches, routers, and servers. The switches segment held 50.1% share of the South & Central America pluggable optics for data center market in 2023, amassing US$ 146.24 million. It is projected to garner US$ 256.70 million by 2031 to expand at 7.3% CAGR during 2023–2031.

By data rate, the South & Central America pluggable optics for data center market is segmented into 100-400GB/S, 400-800GB/S, and 800GB/S and Above. The 400-800GB/S segment held 47.0% share of the South & Central America pluggable optics for data center market in 2023, amassing US$ 137.20 million. It is projected to garner US$ 233.97 million by 2031 to expand at 6.9% CAGR during 2023–2031.

Based on country, the South & Central America pluggable optics for data center market is segmented into Brazil, Argentina, and the Rest of South & Central America. Brazil held 63.8% share of South & Central America pluggable optics for data center market in 2023, amassing US$ 164.83 million. It is projected to garner US$ 288.11 million by 2031 to expand at 7.2% CAGR during 2023–2031.

Key players operating in the pluggable optics for data center market are Coherent Corp, Nokia Corp, Cisco Systems I, Infinera Corp, Telefonaktiebolaget LM Ericsson, Ciena Corp, Intel Corp, Lumentum Holdings Inc, Juniper Networks Inc, Marvell Technology Inc, Yangtze Optical Fibre, and Cable Joint Stock Ltd, and Broadcom Inc, among others.

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