Optical Encryption Market by Encryption Layer (OTN or Layer1, MACsec or Layer 2, and IPsec or Layer 3), Data Rate (10G, 40G, 100G), Vertical (BFSI, Government, Healthcare, Data Centre & Cloud, Energy & Utilities), and Geography - Global Forecast to 2023
[143 Pages Report] The optical encryption market was valued at USD 2.53 billion in 2017 and projected to reach USD 4.24 billion by 2023, at a CAGR of 8.9% during the forecast period. Emerging requirement of regulatory compliances, growing concern over data security and privacy due to cyberattacks, and rising data center deployments are the major driving factors for the optical encryption market.
Years considered for this report are as follows:
- 2017: Base year
- 2018: Estimated year
- 2023: Forecast year
- 20182023: Forecast period
The objectives of the report are as follows:
- To define, describe, segment, and forecast the global optical encryption market, in terms of value and volume, based on encryption layer, data rate, vertical, and geography
- To forecast the market size, in terms of value, into 4 main regions: the Americas, Europe, Asia Pacific (APAC), and Rest of the World (RoW)
- To strategically analyze the micromarkets1 about the individual growth trends, prospects, and contribution to the market
- To provide detailed information regarding the major factors (drivers, restraints, opportunities, and industry-specific challenges) influencing the growth of the market
- To analyze opportunities in the market for stakeholders and the details of the competitive landscape for leaders in the market
- To provide a detailed overview of the value chain in the optical encryption market
- To analyze competitive developments such as expansions, mergers & acquisitions, and product launches, along with research and development (R&D) in the market
- To strategically profile key players of the optical encryption market and comprehensively analyze their market ranking and core competencies
The research methodology used to estimate and forecast the optical encryption market begins with capturing data on key vendors through secondary sources such as The Optical Society (OSA), IEEE Communications Society (ComSoc), The Fiber Optic Association, and Journal of Optical Communications and Networking. Moreover, vendor offerings are also considered to determine the market segmentation. Top-down and bottom-up procedures have been employed to arrive at the overall size of the market on the basis of the revenues of the key players in the market. After arriving at the overall market size, the overall market has been split into several segments and subsegments, which have been verified through primary research by conducting extensive interviews with key officials such as CEOs, VPs, directors, and executives. The market breakdown and data triangulation procedures have been employed to complete the overall market engineering process and arrive at the exact statistics for all segments and subsegments. The breakdown of the profiles of primaries is depicted in the following figure:
To know about the assumptions considered for the study, download the pdf brochure
This report provides valuable insights on the optical encryption ecosystem, which includes raw material suppliers, original equipment manufacturers (OEM), system integrators, suppliers and distributors, and end users. Ciena (US), ADVA (Germany), Nokia (Finland), ECI Telecom (Israel), and Cisco (US) are among the major OEMs of optical encryption devices. The system integrators include various optical encryption-enabled network equipment manufacturers such as Cisco (US), Nokia (Finland), Ericson (Sweden), Huawei (China), and others. End users of the market include long haul and metro service providers such as Verizon (US), AT&T (US), and China Mobile (China); data center owners such as Microsoft (US), Google (US), and Facebook (US); cable operators and multiple system operators such as Time Warner Cable (US), Masergy (US), and Vodafone (UK); mobile operators such as Deutsche Telekom (Germany), Telefonica (Spain), and Orange (France).
Major players in the optical encryption market include Ciena (US), ADVA (Germany), Nokia (Finland), ECI Telecom (Israel), Cisco (US), Huawei Technologies (China), Microsemi (US), Infinera (US), Arista Networks (US), and Acacia Communications (US).
Key Target Audience:
- Raw material and manufacturing equipment suppliers
- Original design manufacturers (ODMs)
- Electronic design automation (EDA) and design tool vendors
- Original equipment manufacturers (OEMs)
- ODM and OEM technology solution providers
- Assembly, testing, and packaging vendors
- Technology, service, and solution providers
- Intellectual property (IP) core and licensing providers
- Suppliers and distributors
- Integrated device manufacturers (IDMs)
- Government and other regulatory bodies
- Technology investors
- Research institutes and organizations
- Market research and consulting firms
The study answers several questions for the stakeholders, primarily, which market segments to focus on in the next 25 years (depending on the range of the forecast period) for prioritizing the efforts and investments.
Report Scope:
In this report, the optical encryption market has been segmented based on the following categories. Additionally, the industry trends have also been detailed in the report.
- Optical Encryption Market, by Encryption Layer
- OTN or Layer1
- MACsec or Layer 2
- IPsec or Layer 3
- Optical Encryption Market, by Data Rate
- Less than 10G
- Greater than 10G and less than 40G
- Greater than 40G and less than 100G
- Greater than 100G
- Optical Encryption Market, by Vertical
- Banking, financial services, and insurance (BFSI)
- Government
- Healthcare
- Data center and cloud
- Energy and utilities
- Others (retail, media & entertainment, education, and process and manufacturing industries)
- Optical Encryption Market, by Geography
- Americas:
- US
- Canada
- Mexico
- Brazil
- Rest of the Americas
- Europe:
- France
- Germany
- UK
- Italy
- Rest of Europe
- Asia Pacific (APAC):
- China
- South Korea
- Japan
- India
- Rest of APAC
- Rest of the World (RoW):
- Middle East
- Africa
- Americas:
- Competitive Landscape
- Company Profiles: Detailed analysis of the major companies in the optical encryption market
Available Customizations:
- Detailed analysis and profiling of additional market players on the basis of various blocks of the value chain
Please click here to get the relevant report of Fiber Optic Components Market by Component (Transceivers, AOCs, Cables, Amplifiers, Splitters, Connectors, Circulators), Data Rate (10G, 40G, 100G, above 100G), Application (Communications, Distributed Sensing) - Global Forecast to 2023
The optical encryption market is expected to grow from USD 2.77 billion in 2018 to USD 4.24 billion by 2023, at a CAGR of 8.9% between 2018 and 2023. The growth of this market is driven by emerging requirement of regulatory compliances, growing concern over data security and privacy due to cyberattacks, and rising data center deployments.
Layer 3 encryption accounted for the largest share of the optical encryption market in 2017. Layer 3 encryption is widely used and accepted for internet-based virtual private networks (VPNs). Many large-scale IPsec deployments are currently in operation across enterprise and government networks. It provides seamless security to application and transport layers and can be applied to networks of all sizes from local area network (LAN) to wide area network (WAN). The market for Layer 1 is expected to grow at the highest CAGR during the forecast period. The reason for this growth is the advantages such as reduced cost, lower latency, high bandwidth efficiency, improved performance, and high availability, offered by Layer 1 encryption.
The greater than 10G and less than 40G data rate segment accounted for the largest share of the optical encryption market in 2017. This can be attributed to the large-scale adoption of the optical encryption in different verticals such as BFSI, government, healthcare, and energy and utilities where the average data rate transfer is in the range of 10G and 40G. The market for greater than 100G optical encryption is expected to grow at the highest CAGR during the forecast period. This growth can be attributed to the requirement for encryption rates to align at speeds beyond 100G for any packet size so as to meet the demand for increased bandwidth driven by cloud services, mobile devices, and massive increases in video traffic.
The banking, financial services, and insurance (BFSI) vertical accounted for the largest share of the market in 2017. The optical encryption is being increasingly deployed by the BFSI sector to protect their customers, meet government and industry data security compliance standards, facilitate security auditing, and avoid reputation damage caused by data breaches. The optical encryption market for the data center and cloud vertical is expected to grow at the highest CAGR during the forecast period. Data centers play a crucial role in delivering IT services and providing storage, communications, and networking to a growing number of networked devices, users, and business processes in general. The growing importance of data analytics has boosted the value and growth of data centers.
The Americas accounted for the largest share of the optical encryption market in 2017. The high adoption of cloud-based applications in the Americas has led to a dramatic increase in the number of cyberattacks, which are also becoming more sophisticated. The optical encryption market in APAC is expected to grow at the highest CAGR between 2018 and 2023 owing to the extension of the network in China, Thailand, Malaysia, South Korea, India, and other developing countries in APAC. APAC is the largest producer as well as consumer of smartphones, laptops, televisions (TVs), and various other data-generating devices across the world.
The introduction of several advanced protocols and platforms, and consistent need for a compact network have resulted in the growing use of connectivity integrated circuits (ICs). However, as hardware and software both play a key role in emerging infrastructures, such as IoT and adoption of open-source platforms through the cloud, the network demands more compact equipment. The current network infrastructure is fragmented and focuses more on domain-specific growth than a consumer-centric joint approach. Thus, companies need to adopt an innovative and network-oriented approach to minimize network complexity; this is a factor restraining the growth of the optical encryption market
Major players in the optical encryption market include Ciena (US), ADVA (Germany), Nokia (Finland), ECI Telecom (Israel), Cisco (US), Huawei Technologies (China), Microsemi (US), Infinera (US), Arista Networks (US), and Acacia Communications (US). Most of the leading companies have followed the inorganic strategy of contracts to boost their revenues.
To speak to our analyst for a discussion on the above findings, click Speak to Analyst
Table of Contents
1 Introduction (Page No. - 14)
1.1 Objectives of Study
1.2 Definition
1.3 Study Scope
1.3.1 Markets Covered
1.3.2 Geographic Scope
1.3.3 Years Considered for the Study
1.4 Currency
1.5 Limitations
1.6 Market Stakeholders
2 Research Methodology (Page No. - 18)
2.1 Research Data
2.1.1 Secondary Data
2.1.1.1 List of Major Secondary Sources
2.1.1.2 Secondary Sources
2.1.2 Primary Data
2.1.2.1 Primary Interviews With Experts
2.1.2.2 Key Data From Primary Sources
2.1.2.3 Key Industry Insights
2.1.2.4 Breakdown of Primaries
2.1.3 Secondary and Primary Research
2.2 Market Size Estimation
2.2.1 Bottom-Up Approach
2.2.1.1 Approach for Capturing the Market Share By Bottom-Up Analysis (Demand Side)
2.2.2 Top-Down Approach
2.2.2.1 Approach for Capturing the Market Share By Top-Down Analysis (Supply Side)
2.3 Market Ranking Estimation
2.4 Market Breakdown and Data Triangulation
2.5 Research Assumptions
3 Executive Summary (Page No. - 29)
4 Premium Insights (Page No. - 34)
4.1 Attractive Opportunities in the Optical Encryption Market
4.2 Market, By Encryption Layer
4.3 Market, By Data Rate
4.4 Market in APAC, By Vertical and Country
4.5 Country-Wise Analysis of Market
4.6 Market, By Region
5 Market Overview (Page No. - 39)
5.1 Introduction
5.2 Market Dynamics
5.2.1 Drivers
5.2.1.1 Emerging Requirements for Regulatory Compliances
5.2.1.2 Growing Concern Over Data Security and Privacy Due to Cyberattacks
5.2.1.3 Increasing Internet Penetration and Data Traffic
5.2.1.4 Rising Data Center Deployments
5.2.2 Restraints
5.2.2.1 Increasing Network Complexity
5.2.3 Opportunities
5.2.3.1 Increasing Adoption of Cloud-Based Services and Iot
5.2.3.2 Growing Implementation of Network in Developing Countries
5.2.4 Challenges
5.2.4.1 Varying Government Policies for Data Protection Across Different Regions
5.3 Value Chain Analysis
6 Market, By Encryption Layer (Page No. - 52)
6.1 Introduction
6.2 Layer 1
6.3 Layer 2
6.4 Layer 3
7 Market, By Data Rate (Page No. - 59)
7.1 Introduction
7.2 Less Than 10g
7.3 Greater Than 10g and Less Than 40g
7.4 Greater Than 40g and Less Than 100g
7.5 Greater Than 100g
8 Market, By Vertical (Page No. - 66)
8.1 Introduction
8.2 BFSI
8.3 Government
8.4 Healthcare
8.5 Data Center and Cloud
8.6 Energy and Utilities
8.7 Others
9 Market, By Geography (Page No. - 81)
9.1 Introduction
9.2 Americas
9.2.1 US
9.2.2 Canada
9.2.3 Mexico
9.2.4 Brazil
9.2.5 Rest of the Americas
9.3 Europe
9.3.1 Germany
9.3.2 France
9.3.3 UK
9.3.4 Italy
9.3.5 Rest of Europe
9.4 Asia Pacific
9.4.1 China
9.4.2 Japan
9.4.3 South Korea
9.4.4 India
9.4.5 Rest of APAC
9.5 Rest of the World
9.5.1 Middle East
9.5.2 Africa
10 Competitive Landscape (Page No. - 100)
10.1 Overview
10.2 Market Ranking Analysis
10.3 Competitive Scenario
10.3.1 Contracts
10.3.2 Product Launches
10.3.3 Acquisitions and Partnerships
11 Company Profiles (Page No. - 106)
11.1 Introduction
11.2 Key Players
(Business Overview, Products Offered, Strength of Product Portfolio, Business Strategy Excellence, Recent Developments, Key Relationships)*
11.2.1 Ciena
11.2.2 Adva
11.2.3 Nokia
11.2.4 ECI Telecom
11.2.5 Cisco
11.2.6 Huawei
11.2.7 Microsemi
11.2.8 Infinera
11.2.9 Arista Networks
11.2.10 Acacia Communications
*Details on Business Overview, Products Offered, Strength of Product Portfolio, Business Strategy Excellence, Recent Developments, Key Relationships Might Not Be Captured in Case of Unlisted Companies.
11.3 Other Key Players
11.3.1 Broadcom
11.3.2 Juniper Networks
11.3.3 Packetlight Networks
11.3.4 Thales E-Security
11.3.5 Centurylink
11.4 Key Innovators
11.4.1 Windstream Holdings
11.4.2 Nucrypt
11.4.3 SSE Enterprise Telecoms
11.4.4 Coriant
11.4.5 Smartoptics
12 Appendix (Page No. - 136)
12.1 Discussion Guide
12.2 Knowledge Store: Marketsandmarkets Subscription Portal
12.3 Introducing RT: Real-Time Market Intelligence
12.4 Available Customizations
12.5 Related Reports
12.6 Author Details
List of Tables (68 Tables)
Table 1 List of Regulatory Compliance for Data Protection
Table 2 Optical Encryption Market, By Encryption Layer, 20152023 (USD Million)
Table 3 Market, By Encryption Layer, 20152023 (Thousand Units)
Table 4 Market for Layer 1, By Data Rate, 20152023 (USD Million)
Table 5 Market for Layer 1, By Data Rate, 20152023 (Units)
Table 6 Market for Layer 2, By Data Rate, 20152023 (USD Million)
Table 7 Market for Layer 2, By Data Rate, 20152023 (Units)
Table 8 Market for Layer 3, By Data Rate, 20152023 (USD Million)
Table 9 Market for Layer 3, By Data Rate, 20152023 (Units)
Table 10 Comparative Analysis of Optical Encryption Layers
Table 11 Market, By Data Rate, 20152023 (USD Million)
Table 12 Market, By Data Rate, 20152023 (Thousand Units)
Table 13 Market for Less Than 10g, By Encryption Layer, 20152023 (USD Million)
Table 14 Market for Less Than 10g, By Encryption Layer, 20152023 (Units)
Table 15 Market for Greater Than 10g and Less Than 40g, By Encryption Layer, 20152023 (USD Million)
Table 16 Market for Greater Than 10g and Less Than 40g, By Encryption Layer, 20152023 (Units)
Table 17 Market for Greater Than 40g and Less Than 100g, By Encryption Layer, 20152023 (USD Million)
Table 18 Market for Greater Than 40g and Less Than 100g, By Encryption Layer, 20152023 (Units)
Table 19 Market for Greater Than 100g, By Encryption Layer, 20152023 (USD Million)
Table 20 Market for Greater Than 100g, By Encryption Layer, 20152023 (Units)
Table 21 Market, By Vertical, 20152023 (USD Million)
Table 22 Market, By Vertical, 20152023 (Thousand Units)
Table 23 Market for BFSI, By Encryption Layer, 20152023 (USD Million)
Table 24 Market for BFSI, By Encryption Layer, 20152023 (Units)
Table 25 Market for BFSI, By Data Rate, 20152023 (USD Million)
Table 26 Market for BFSI, By Data Rate, 20152023 (Units)
Table 27 Market for Government, By Encryption Layer, 20152023 (USD Million)
Table 28 Market for Government, By Encryption Layer, 20152023 (Units)
Table 29 Market for Government, By Data Rate, 20152023 (USD Million)
Table 30 Market for Government, By Data Rate, 20152023 (Units)
Table 31 Market for Healthcare, By Encryption Layer, 20152023 (USD Million)
Table 32 Market for Healthcare, By Encryption Layer, 20152023 (Units)
Table 33 Market for Healthcare, By Data Rate, 20152023 (USD Million)
Table 34 Market for Healthcare, By Data Rate, 20152023 (Units)
Table 35 Market for Data Center and Cloud, By Encryption Layer, 20152023 (USD Million)
Table 36 Market for Data Center and Cloud, By Encryption Layer, 20152023 (Units)
Table 37 Market for Data Center and Cloud, By Data Rate, 20152023 (USD Million)
Table 38 Market for Data Center and Cloud, By Data Rate, 20152023 (Units)
Table 39 Market for Energy and Utilities, By Encryption Layer, 20152023 (USD Million)
Table 40 Market for Energy and Utilities, By Encryption Layer, 20152023 (Units)
Table 41 Market for Energy and Utilities, By Data Rate, 20152023 (USD Million)
Table 42 Market for Energy and Utilities, By Data Rate, 20152023 (Units)
Table 43 Market for Other Verticals, By Encryption Layer, 20152023 (USD Million)
Table 44 Market for Other Verticals, By Encryption Layer, 20152023 (Units)
Table 45 Market for Other Verticals, By Data Rate, 20152023 (USD Million)
Table 46 Market for Other Verticals, By Data Rate, 20152023 (Units)
Table 47 Market, By Region, 20152023 (USD Million)
Table 48 Market, By Region, 20152023 (Thousand Units)
Table 49 Market in Americas, By Vertical, 20152023 (USD Million)
Table 50 Market in Americas, By Vertical, 20152023 (Units)
Table 51 Market in Americas, By Country, 20152023 (USD Million)
Table 52 Market in Americas, By Country, 20152023 (Units)
Table 53 Market in Europe, By Vertical, 20152023 (USD Million)
Table 54 Market in Europe, By Vertical, 20152023 (Units)
Table 55 Market in Europe, By Country, 20152023 (USD Million)
Table 56 Market in Europe, By Country, 20152023 (Units)
Table 57 Market in APAC, By Vertical, 20152023 (USD Million)
Table 58 Market in APAC, By Vertical, 20152023 (Units)
Table 59 Market in APAC, By Country, 20152023 (USD Million)
Table 60 Market in APAC, By Country, 20152023 (Units)
Table 61 Market in RoW, By Vertical, 20152023 (USD Million)
Table 62 Market in RoW, By Vertical, 20152023 (Units)
Table 63 Market in RoW, By Region, 20152023 (USD Million)
Table 64 Market in RoW, By Region, 20152023 (Units)
Table 65 Ranking of Top 5 Players in the Market, 2017
Table 66 10 Most Recent Contracts in this market
Table 67 10 Most Recent Product Launches in this market
Table 68 5 Most Recent Acquisitions and Partnerships in this market
List of Figures (42 Figures)
Figure 1 Optical Encryption Market: Research Design
Figure 2 Process Flow
Figure 3 Market Size Estimation Methodology: Bottom-Up Approach
Figure 4 Market Size Estimation Methodology: Top-Down Approach
Figure 5 Market for Layer 1 to Grow at Highest CAGR During Forecast Period
Figure 6 Optical Encryption Devices With Data Rate Greater Than 10g and Less Than 40g to Hold Largest Share of market During Forecast Period
Figure 7 Market for Data Center and Cloud Vertical to Grow at Highest CAGR During Forecast Period
Figure 8 Market in APAC to Grow at Highest CAGR During Forecast Period
Figure 9 Growing Concern Over Data Security and Privacy Due to Cyberattacks is Driving Growth of market
Figure 10 Market for Layer 1 Expected to Grow at Highest CAGR During Forecast Period
Figure 11 Greater Than 10g and Less Than 40g to Hold Largest Share of the market During Forecast Period
Figure 12 China to Hold Largest Share of Market in APAC in 2018
Figure 13 US Expected to Hold Largest Share of market in 2018
Figure 14 Market in APAC Expected to Grow at Highest CAGR During Forecast Period
Figure 15 Growing Concern Over Data Security and Privacy Due to Cyberattacks is Driving the Growth of the market
Figure 16 Global IP Traffic (20162021)
Figure 17 Global Mobile Data Traffic and Internet Penetration (20162021)
Figure 18 Global Data Center IP Traffic Growth (20162021)
Figure 19 Regional Analysis of Data Center Growth (20162021)
Figure 20 Cloud Service Trends: SaaS to Be Most Widely Deployed Global Cloud Service
Figure 21 Increasing Penetration Rate of Connected Objects (20122020)
Figure 22 Unique Subscriber Penetration, By Region (In 2017, 2020, and 2025)
Figure 23 Value Chain Analysis: Major Value is Added By Research, Design, and Development and Original Equipment Manufacturing Phases
Figure 24 Market for Layer 1 to Grow at Highest CAGR During Forecast Period
Figure 25 Market for Greater Than 100g Data Rate to Grow at Highest CAGR During Forecast Period
Figure 26 Market for Data Center and Cloud Vertical to Grow at Highest CAGR During Forecast Period
Figure 27 Geographic Snapshot: Market
Figure 28 Americas: Snapshot of Market
Figure 29 Europe: Snapshot of Market
Figure 30 APAC: Snapshot of Market
Figure 31 RoW: Snapshot of Market
Figure 32 Contracts Emerged as Key Growth Strategy Adopted By Market Players Between January 2015 and December 2017
Figure 33 Evaluation Framework: Market
Figure 34 Ciena: Company Snapshot
Figure 35 Adva: Company Snapshot
Figure 36 Nokia: Company Snapshot
Figure 37 Cisco: Company Snapshot
Figure 38 Huawei: Company Snapshot
Figure 39 Microsemi: Company Snapshot
Figure 40 Infinera: Company Snapshot
Figure 41 Arista Networks: Company Snapshot
Figure 42 Acacia Communications: Company Snapshot
Growth opportunities and latent adjacency in Optical Encryption Market
Want to understand market segmentation by encryption layers (OTNSEC, DCI-based Ethernet MACSEC and IPSEC). Further, would like to have breakdown of data rates by vertical. Is this covered in the report?