2 May 2014—A new report by Transparency Market Research forecasts that the photonic integrated circuits (PIC) market is poised for dramatic compound annual growth rate of 31.3 percent over the next five years. Photonic integrated circuits use photons in place of electrons as the data carrier on circuit boards, reducing size, power consumption and reliability without increasing cost.

This market for 2012 reached $160.1 million and will grow to $996.2 million by 2019. Cost reduction measures including the integration of various optical components such as lasers, detectors and modulators into a single package will continue to drive growth.

PIC market growth is partly due to its expansion into optical communications (63 percent of the market in 2012), sensing and biophotonics, as well as energy markets. The drive for increased data transfer speeds is another market driver.

Monolithic integration (which integrates functionality into medium- and large-scale PICs) is predicted to grow at a CAGR of 36.3 percent between 2013 and 2019 with its improvements in reliability, footprint, efficiency and stabilization. But the report finds that hybrid integration, which currently holds 56.1 percent of the global market, will remain dominant. While North America dominates with 45 percent of the global PIC market share, followed by Europe, the Asia-Pacific region will see the largest growth through 2019 of 35.2 percent following the growth in manufacturing facilities.