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The optical transport network (OTN) market is poised again for solid growth as operators prepare their infrastructures to tackle a new generation of bandwidth-hungry applications and AI deployments.<\/span><\/p>\n “There is a light at the end of this tunnel,” said Jimmy Yu, vice president of research at Dell’Oro Group, citing the OTN market’s strong performance during the last quarter of 2024. “The equipment glut is over.”<\/span><\/p>\n Vendors have indicated increased equipment order flows, Yu said, and optical revenue in North America is improving.<\/span><\/p>\n The OTN market is fueled by cloud computing, 5G deployment and bandwidth-intensive applications, such as video streaming and AI-driven analytics. AI and cloud put massive new demands on data center and network operators. As traffic volume continues to rapidly climb, operators are tasked to overcome challenges by upgrading facilities with advanced optical network devices.<\/span><\/p>\n As a result, telecom operators and data centers are investing heavily in system upgrades, according to a report issued by Orion Market Research. Operators are focusing on innovations in wavelength-division multiplexing (WDM) and software-defined networking (SDN) to enhance their OTN capabilities.<\/span><\/p>\n The OTN market’s resurgence comes after an equipment overbuying period in which service providers hoarded optical transport products, uncertain of when COVID-19-era supply chains would recover and economic headwinds subside. Additionally, the market is benefiting from the introduction of 1.2 Tbps transmission and more efficient power use. <\/span>Nokia’s $2.3 billion acquisition of Infinera<\/a><\/span>, meantime, provided another jolt of optimism.<\/span><\/p>\nServing Telecom Operators and Data Centers<\/h2>\n