Redding, California, Oct. 04, 2021 (GLOBE NEWSWIRE) — According to a new market research report titled, “VCSEL Market by Type (Multi-mode VCSEL, Single-mode VCSEL), Material (Gallium Arsenide, Gallium Nitride, Indium Phosphide), Application (Sensing, Data Communication, Industrial Heating, Laser Printing, LiDAR), and Geography—Global Forecast to 2027,” published by Meticulous Research®, the VCSEL market is expected to record a CAGR of 21.5% from 2020 to 2027 to reach $3.73 billion by 2027. In terms of volume, the VCSEL market is estimated to grow at a CAGR of 31.9% from 2020 to 2027 to reach 3,854 million units by 2027.
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A vertical-cavity surface-emitting laser (VCSEL) is a surface-emitting semiconductor light source with a monolithic laser resonator, where the emitted light leaves the device in a direction perpendicular to the chip surface. The resonator (cavity) is realized with two semiconductor Bragg mirrors (distributed Bragg reflector lasers). It offers high data transmission over short-distance links, interconnects, and local area networks.
VCSELs are suitable light sources for transmitting RF and microwave signals, such as radio-over-fiber (ROF) networks. It is used in antenna remoting in cellular systems for mobile communication. Semiconductor materials used in VCSEL structure include Gallium Arsenide (GaAs), Aluminum Gallium Arsenide (GaAs), Indium Phosphide (InP), Gallium Nitride (GaN), Aluminum Arsenide (GaAlAs), Indium Gallium Arsenide Phosphide (InGaAsP), and Aluminum Gallium Arsenide Antimonide (AlGaAsSb).
The growth of this market is mainly attributed to factors such as the growing demand for VCSELs in 3D sensing applications and the high adoption of VCSEL arrays among data centers. Advancements in vehicle automation and the growing utilization of 5G technology have created opportunities for the growth of the VCSELs market. Due to the significant demand for VCSELs among various industries, the global VCSELs market is expected to grow exponentially in the coming years. Moreover, new applications such as Advanced Driver Assistance Systems (ADAS), in-cabin sensing, and driver fatigue monitoring in semi- and fully autonomous vehicles are expected to create immense market opportunities for VCSEL manufacturers in the coming years.
The Impact of COVID-19 on the VCSEL Market
The COVID-19 pandemic caused a widespread economic downturn as several countries imposed strict lockdowns to contain the infection, severely affecting many industries, including manufacturing. There has been a significant impact on technology supply chains globally. The crisis has led to declining industrial activities leading to a slowdown in the production of key semiconductor components. Since China is the major semiconductor hub, disruptions severely impacted companies in the electronics value chain.
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Consumer electronics is one of the segments to witness a huge decline in 2020. Due to the drastic fall in demand and supply chain disruption, manufacturers are slowing down their production. Early 2020 witnessed the shutting down of manufacturing facilities in China due to quarantine mandates, which caused a ripple effect on the global economy. Many industries with high trade exposure to China were impacted drastically, such as semiconductors, consumer electronics, and automotive component production. Being one of the largest production centers for consumer electronics, particularly smartphones, China severely affected the global smartphones market, leading to increased product delays and idle production. After the first two quarters of the decline of 20%, quarterly smartphone sales started to recover sequentially. However, the sales continued to remain weaker compared to 2019, even with vendors introducing multiple 5G smartphones and governments supporting production in some geographies.
Furthermore, this pandemic effect was catalyzed by the US-China trade war, driving many manufacturers to consider shifting their facilities to other Asian countries, including Vietnam, India, Taiwan, and Malaysia. The smartphone market witnessed an overall decline of more than 10% in 2020.
Growing utilization in 5G technology to offer significant growth opportunities for players operating in this market
The introduction of 5G mobile network systems has boosted the adoption of emerging technologies such as artificial intelligence (AI), virtual/augmented reality (VR/AR), and the internet of things (IoT). Due to this, data traffic in data centers is continuously increasing. To support this increase, new VCSEL designs with PAM-4 modulation format are used for multi-level modulation. The new VCSEL technology is used in other emerging technologies for 50Gbps PAM-4 operation and offers good uniformity. The technology is mostly used for 400 Gbps array products.
5G technology is expected to offer greater efficiency, improved delivery, and enhanced network connectivity. It is expected to emerge as a massively improved platform to deliver scalable and reliable connectivity to the world. Also, its high data rate and low latency allow high-speed real-time transfer of data among users. Advanced 5G capabilities will increase digital inclusion for urban residents who still lack access to high-speed broadband internet. More people will have access to smart city services, which will always be connected. The technology’s instantaneous transfer of videos from the security cameras installed across cities to the authorities enables them to react to emergencies immediately whenever needed.
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5G technology has significantly enhanced IoT opportunities by supporting higher data transfer and lower latency rates. IoT devices use various sensors, among which VCSELs–based 3D sensors will replace multiple sensors in the future. The IoT-enabled smart devices embedded with VCSELs are installed in vehicles, airports, railway stations, libraries, buildings, shopping malls, schools, colleges, and roads. Also, VCSELs cater to 3D sensing applications in smart homes and smart cities. In smart cities, VCSELs-based sensors can be used in parking lots, museums, and retail outlets for safety and security purposes.
Smartphone manufacturing companies are rapidly adopting artificial Intelligence (AI) to give their consumers a better experience. For instance, many smartphone companies like Apple Inc., Samsung, and Huawei use VCSELs and AI chips to manage 5 trillion operations per second at significantly less power consumption.
In January 2021, Seoul Viosys released new VCSEL solutions for 5G devices. The company has developed VCSEL technology for 5G communication-based smart cities, autonomous driving applications, AR/VR, and industrial IoT markets. VCSEL technology is expected to be in high demand to support the high data requirements of camera-based Time-of-Flight and 3D sensing applications in next-generation 5G devices and LiDAR applications in smart vehicles.
To provide efficient analysis, Meticulous Research® has segmented this market based on type (multi-mode VCSEL and single-mode VCSEL), material (Gallium Arsenide, Gallium Nitride, Indium Phosphide, and other materials), application (sensing, data communication, industrial heating, laser printing, LiDAR, pulse oximetry, and other applications), end user (consumer electronics, IT & telecom, industrial, aerospace & defense, healthcare, and automotive), and geography (Asia-Pacific, Europe, North America, Latin America, and the Middle East & Africa).
Based on type, the VCSELs market is segmented into multi-mode and single-mode VCSELs. In 2020, the multi-mode VCSELs segment commanded the larger share of the VCSELs market. The increasing utilization of VCSELs in data communication is expected to boost the demand for multi-mode VCSELs during the forecast period. Many industries are adopting multi-mode VCSELs due to their compact size, high performance, and high reliability.
However, the single-mode segment is expected to register the highest CAGR during the forecast period. The proliferation of mobile devices has accelerated the adoption of single-mode VCSELs globally. Single-mode VCSELs are mainly used to reduce power consumption, improve battery life, and enhance the user experience of mobile phones and various other devices.
Based on material, the VCSELs market is segmented into Gallium Arsenide, Gallium Nitride, Indium Phosphide, and other materials. In 2020, the Gallium Arsenide segment commanded the largest share of the VCSELs market. The adoption of Gallium Arsenide-based VCSELs is on the rise in 3D sensing, LiDAR, and 5G applications due to their advantages, including low current threshold, low power consumption, and small divergence angles.
Based on application, the VCSELs market is segmented into sensing, data communication, industrial heating, laser printing, LiDAR, pulse oximetry, and other applications. In 2020, the sensing segment commanded the largest share of the VCSELs market. The large market share is attributed to the extensive utilization of VCSELs for 3D sensing applications in the consumer electronics industry and in-cabin sensing and infotainment control in the automotive sector. The LiDAR segment is expected to register the highest CAGR during the forecast period. LiDAR systems are widely used in industrial automation, automotive applications, traffic control, and range finders. These systems are being increasingly used in automotive and drone applications due to their benefits, such as better performance and safety.
Based on end user, the VCSELs market is segmented into consumer electronics, IT & telecom, industrial equipment manufacturing, aerospace & defense, healthcare, and automotive. The consumer electronics segment commanded the largest share of the VCSELs market in 2020. The automotive segment is expected to register the highest CAGR during the forecast period. VCSELs are used as automotive sensors for optical touch in steering wheels and vehicle dashboards. They enable emergency braking and adaptive cruise control and are also used in mirrors and thermoelectric coolers.
In 2020, North America commanded the largest share of the global VCSEL market, followed by Europe. The presence of a large number of data centers and consumer electronics players, such as Apple Inc., which utilizes VCSELs for various applications, are some of the factors driving this regional segment. However, the VCSELs market in Asia-Pacific is expected to register the highest CAGR during the forecast period. China is the leading manufacturer and end-user of consumer electronics devices. The country has become a booming market for VCSELs due to the extensive utilization of VCSELs by companies such as Oppo, Xiaomi, and Vivo in their smartphones. VCSELs are used for 3D sensing applications, such as facial recognition, gesture recognition, and Animojis in smartphones. VCSELs technology has gained significance, and the technology’s benefits have encouraged OEMs to adopt VCSELs in smart devices, driving the demand for VCSELs in the consumer electronics segment.
However, the trade war between the U.S. and China has impacted the supply chains in China, affecting many consumer electronics manufacturers. This led to several Chinese companies creating their supply chains, giving rise to technology start-ups such as Vertilite.
Another major growth driver for this market is the new functionalities in the automotive segment. China-based automotive maker—Great Wall Motors has collaborated with Germany’s Ibeo Automotive Systems, which specializes in LiDAR systems for autonomous driving, to deploy VCSELs for ‘Level 3’ semi-autonomous cars manufactured by Great Wall Motors. VCSELs coupled with LiDAR are expected to be the next big technology for applications like collision avoidance, driver assistance, and in-cabin sensing in semi- and fully autonomous cars.
VCSELs arrays provide the flood source for intense and directed infrared radiation and can be used without additional optics for surface heating. Also, VCSELs are used in heating systems for industrial heat treatment. VCSELs heating modules can be easily integrated with machines for industrial applications and production processes.
The top five players that dominated the global VCSEL market were Lumentum Operations LLC (U.S.), ams AG (Austria), TRUMPF (Germany), II-VI Incorporated (U.S.), and Broadcom Inc. (U.S.). Other key players operating in the VCSEL market include OSRAM GmbH (Germany), IQE PLC (U.K.), VERTILAS GmbH (Germany), Vertilite Co., Ltd. (China), FLIR Systems, Inc. (U.S.), Thorlabs, Inc. (U.S.), Leonardo S.p.A. (Italy), TT Electronics PLC (U.K.), Photonwares Co. (U.S.), and Inneos LLC (U.S.). These players continuously focus on agreements, collaborations, & partnerships, and new product development & launches to increase their respective market shares.
To gain more insights into the market with a detailed table of content and figures, click here: https://www.meticulousresearch.com/product/vertical-cavity-surface-emitting-laser-market-5166
Key Questions Answered in the Report–
- Which are the high-growth market segments in terms of type/material/application/end user/region?
- What was the historical market size for VCSEL globally?
- What are the market forecasts and estimates for 2020–2027?
- What are the major drivers, restraints, opportunities, and challenges in the global VCSEL market?
- Who are the major players in the VCSEL market?
- How is the competitive landscape and who are the market leaders in the global VCSEL market?
- What are the recent developments in the global VCSEL market?
- What are the various strategies adopted by the major players in the global VCSEL market?
- What are the geographical trends and high-growth regions/countries?
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