Omdia recently released its updated PON forecast data, noting a wide adoption of 10G PON technology across North America. Senior Analyst for Service Provider Networks Jaimie Lenderman joined a recent Fiber for Breakfast to share the report’s key takeaways and other notable market trends.
“Even though the average resident does not need 1 Gig, there is the idea that the average North American resident expects 1 Gig,” Lenderman stated.
The North America PON market is expected to grow from $732 million in revenue in 2019 to over $3 billion in 2026, according to Omdia forecasting.
“There is significant growth set to happen in North America,” Lenderman stated. “Infrastructure builds are happening faster, and this is leading to faster PON equipment deployments.”
She mentioned federal programs like RDOF and broadband allocations out of the upcoming infrastructure bill as drivers of that adoption, as well as pressure on the cable industry to upgrade to more future-proof fiber networks.
Non-next-gen PON OLTs are set to be just under 400,000 for shipments in North America this year. Omdia forecasts those ports to decline at a CAGR of 24% as operators choose 10G and higher to support residential and non-residential services and applications.
On the flip side, Omdia projects 10G PON OLT port shipments will grow at a CAGR of 44% through 2026, wherein 2026 shipments are estimated to top 1,000,000.
“The story here is that 10G PON is starting to play a major role in the rollout of fiber access networks in North America,” Lenderman said, noting that PON is a growing influence on access networks.
“PON started as a fiber-to-the-home, fiber-to-the-premises technology. It was considered best efforts and, really, it was an early future-proof strategy for operators,” she recalled, before explaining PON then grew into small business and small to medium enterprise markets.
“It’s gaining mindshare, it allows for easy upgrades to 10G,” she listed. “Additionally, future proofing has become part of a competitive strategy.”
Further, Lenderman explained that PON has allowed for the adoption of open access by not just network operators, but also overbuilders.
Fast forward to present day, PON is being utilized not just for FTTH and small/medium enterprise, but for additional non-residential use cases such as smart city and transport.
“What’s really beginning to gain mindshare and traction is the use of fiber access and PON networks--not just on the service and billing level, but convergence on a physical network level,” Lenderman explained. “This is really allowing operators to support xHaul in terms of fronthaul for 5G, and additionally, this is introducing the capability to do network slicing, whether it be for internal use or for wholesaling.”
The PON market is growing strongly in all regions, aside from China where they already have a high penetration rate for fiber. But where growth is strong, Lenderman said that reflects how important fiber-based access networks are becoming.
“The conversation around fixed mobile network convergence at the infrastructure layer is really making the story for fiber-based access networks and a better understanding of how PON can support 5G and transport” she noted.
The increased adoption of PON does struggle through some challenges, however, including the current supply chain shortages, a lack of skilled labor, the argument between 25G and 50G PON and disagreements between how much bandwidth is needed for residential or transport for non-residential.
Regardless of the details, Lenderman said one thing is clear: “If an operator wants to be able to adopt additional revenue streams, new applications and move beyond residential, 10G PON is the answer.”
Listen to Jaimie Lenderman’s full remarks on the Fiber for Breakfast podcast.