North America Pluggable Optics for Data Center Market Report (2021-2031) by Scope, Segmentation, Dynamics, and Competitive Analysis

The North America pluggable optics for data center market size is expected to reach US$ 4,996.31 million by 2031 from US$ 2,095.42 million in 2023. The market is estimated to record a CAGR of 11.5% from 2023 to 2031.

Executive Summary and North America Pluggable Optics for Data Center Market Analysis:

In North America, the demand for tocotrienols is increasing due to the rising preference for consuming nutraceuticals The rapid expansion of data-intensive applications and cloud computing has resulted in a considerable increase in the number of data centers in North America, leading to an increased demand for pluggable optics. These data centers require high-speed and dependable optical communication, which fuels the demand for pluggable optics. These optics enable efficient data transfer and meet the ever-increasing bandwidth demands of contemporary data centers. Furthermore, the rise of smartphones, IoT devices, and streaming services has resulted in unprecedented data flow. Businesses now recognize the need for seamless, high-quality data transport. Pluggable optics provide the required capacity and scalability to manage the current spike in data traffic, making them a crucial component of data center infrastructure. Furthermore, as per the CBRE North America Data Center Trend Analysis, the top seven wholesale data center markets in North America are in the US: Northern Virginia, Dallas/Fort Worth, Silicon Valley, Chicago, Phoenix, New York Tri-State Area, and Atlanta.

The market in North America is anticipated to expand at a significant rate during the forecast period owing to the surging demand for pluggable optics from the data center operator. This encourages market players to develop advanced high performance pluggable optics to support their customers to easily add or replace optical modules. For instance, according to Coherent Pluggable Optics: A 2023 Heavy Reading Survey, the data indicates that North American operators have a more aggressive demand for pluggable optics compared to their Rest of World counterparts. According to the research, 2025 and 2026 will be crucial years for 800G coherent pluggable adoption, with more than half of respondents expecting deployment in those years. Thus, the rising demand for pluggable optics among cloud providers and hyperscale data centers are driving the market.

North America Pluggable Optics for Data Center Market Strategic Insights

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North America Pluggable Optics for Data Center Market Segmentation Analysis

Key segments that contributed to the derivation of the pluggable optics for data center market analysis are component and data rate.

• Based on component, the North America pluggable optics for data center market is segmented into switches, routers, and servers. The switches held the largest share of the market in 2023.
• By data rate, the North 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 the largest share of the market in 2023.

North America Pluggable Optics for Data Center Market Outlook

Rising adoption of the Internet of Things (IoT), increasing need for storage for massive amounts of data, and growing digitalization are increasing the demand for data centers. It is an excellent data storage solution that provides companies with fast and secure access to vast data. The benefits offered by data centers, such as centralized data management, scalability, and security, encourage businesses to adopt these solutions to achieve a data-driven business landscape. Thus, several companies are investing in the development of data centers in North America. According to Linklaters, North America has maintained its lead in data center transaction values, accounting for an impressive 62% of the global total in 2023 and 69% of investments through April 2024, totaling US$ 15 billion, with the US accounting for the largest share of the total. A few instances are mentioned below:

• In February 2024, NTT DATA—a global digital business and IT services leader—announced that TC Global Investments Americas LLC (a group company of Tokyo Century Corporation) invested in NTT Global Data Centers' American data center business in Chicago, Illinois, a group company of NTT DATA, to cater to continuous demand for cloud services and the broader use of generative AI and other technologies.
• In May 2024, the US President announced a US$ 3.3 billion investment by Microsoft to build a new artificial intelligence (AI) data center. The investment is part of President Biden's "Investing in America agenda," which is focused on creating jobs in critical sectors such as infrastructure, clean energy, semiconductors, and biotechnology by mobilizing private sector investments in the US through legislation such as the CHIPS and Science Act.
• In June 2023, Amazon.com, Inc. announced plans to invest US$ 7.8 billion by 2030 to expand its construction of a data center in Ohio. This data center aims to power with at least 95% renewable energy. The company is committed to reaching net-zero carbon emissions by 2040 and powering operations with 100% renewable energy by 2025.
• In May 2023, Prime Data Centers announced the expansion of the Phoenix market in Avondale, Arizona. Prime Phoenix is a 66.5-acre campus featuring five data centers having 210 megawatts of critical power and 1.3 million square feet of space. The project will result in a high-density, sustainable data center campus that is designed to support hyperscale services providers, large Internet brands, worldwide technology enterprises, and Fortune 500 businesses.

Various technologies, devices, and components are required to build these data centers and ensure their efficient operation. Fiber optics or optical interconnect technologies enable unprecedented scale, bandwidth, flexibility, and efficiency in modern, highly interconnected data centers. Pluggable optics are required to connect network components to convert high-speed electrical signals into optical signals and vice versa. Thus, the growing number of data centers in North America fosters the demand for pluggable optics for these data centers.

North America Pluggable Optics for Data Center Market Country Insights

Based on country, the North America pluggable optics for data center market comprises the US, Canada, and Mexico. The US held the largest share in 2023.

The US is home to ~2,700 data centers. The growth of mega data centers, which require high-speed and reliable connections between different components, is driving the demand for pluggable optics. These data centers need to scale their computing resources to meet the increasing data demands. Northern Virginia has the most data centers in the US. Over 300 Cloud and hyperscale data center providers, including Amazon Web Services, Microsoft Azure, and Google, have committed millions of square feet and hundreds of megawatts to the region, and they continue to expand. Northern Virginia is anticipated to have about 3,500 megawatts of data center inventory, which is more than triple that of any other US market.

Silicon Valley is still a strong market for data centers, creating more demand for pluggable optics. The San Francisco Bay Area, particularly Santa Clara, is a hub for tech giants, startups, and venture capital firms due to its lower power costs. Companies such as Apple, Google, Intel, Salesforce, NVIDIA, and Facebook/Meta have their headquarters in this area. Additionally, Silicon Valley's need for data centers is driven by the desire to be "near to home" and support of the tech ecosystem's innovative and digital services.

North America Pluggable Optics for Data Center Market Report Highlights

North America Pluggable Optics for Data Center Market Company Profiles

Some of the key players operating in the market include 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, and Broadcom Inc among others. These players are adopting various strategies such as expansion, product innovation, and mergers and acquisitions to provide innovative products to their consumers and increase their market share.

North America Pluggable Optics for Data Center Market Research Methodology :

The following methodology has been followed for the collection and analysis of data presented in this report:

• Secondary Research

The research process begins with comprehensive secondary research, utilizing both internal and external sources to gather qualitative and quantitative data for each market. Commonly referenced secondary research sources include, but are not limited to:

• Company websites, annual reports, financial statements, broker analyses, and investor presentations.
• Industry trade journals and other relevant publications.
• Government documents, statistical databases, and market reports.
• News articles, press releases, and webcasts specific to companies operating in the market.

Note: All financial data included in the Company Profiles section has been standardized to USD. For companies reporting in other currencies, figures have been converted to USD using the relevant exchange rates for the corresponding year.

• Primary Research

The Insight Partners’ conducts a significant number of primary interviews each year with industry stakeholders and experts to validate its data analysis, and gain valuable insights. These research interviews are designed to:

• Validate and refine findings from secondary research.
• Enhance the expertise and market understanding of the analysis team.
• Gain insights into market size, trends, growth patterns, competitive dynamics, and future prospects.

Primary research is conducted via email interactions and telephone interviews, encompassing various markets, categories, segments, and sub-segments across different regions. Participants typically include:

• Industry stakeholders: Vice Presidents, business development managers, market intelligence managers, and national sales managers
• External experts: Valuation specialists, research analysts, and key opinion leaders with industry-specific expertise

North America Pluggable Optics for Data Center Market Country and Regional Insights