Optical splitters are the core of FTTH optical devices, possessing enormous growth potential and poised to become a major driver of growth in the FTTX market. This will undoubtedly bring both vitality and challenges to the optical communication manufacturing industry, while also providing optical communication companies with another opportunity for rapid development. This article reviews the PLC splitter market, industry situation, and current technological development status. It also provides a brief analysis of the development of PLC chips, fiber arrays, and coupling packaging technologies.
1. Introduction
Currently, the construction of FTTx (fiber optic access network) in my country is gradually unfolding. The three major telecom operators and the broadcasting system have all adopted the strategy of "accelerating the replacement of copper with fiber and promoting the strategic transformation of access networks," aiming to achieve multimedia transmission such as FTTC (fiber to the curb), FTTB (fiber to the building), FTTH (fiber to the home), FTTD (fiber to the desktop), and triple-play (voice network, data network, and cable TV network), as well as PDS (integrated cabling system) solutions. To build a fully fiber optic network, in addition to various types of distribution cables and drop cables for fiber optic network connection and redistribution, E-PON and G-PON technologies also require a large number of optical splitters to ultimately achieve fiber-to-the-home.
An FTTx system consists of three parts: the central office equipment (OLT), the user terminal equipment (ONU), and the optical distribution network (ODN). As a crucial component of the FTTx system, the ODN serves as the physical optical transmission channel between the OLT and ONU, typically composed of optical fibers, optical connectors, optical splitters, and supporting equipment for connecting these components. The feeder section from the ODF rack in the central office to the optical cable distribution point serves as the backbone cable, achieving long-distance coverage. The distribution section from the optical cable distribution point to the user access point distributes fiber optic cables to user areas along the feeder cable's route. The drop section from the user access point to the terminal is completed by a butterfly drop cable, while all branch and connection points are completed by optical splitters, achieving fiber-to-the-home (FTTH).
Optical splitters are the core of FTTH optical devices, possessing enormous growth potential and becoming a major driver of FTTX market growth. This will undoubtedly bring both vitality and challenges to the optical communication manufacturing industry, while also providing optical communication companies with another opportunity for rapid development. Given the current surge in access network construction, and considering both the current market stage and future demand trends, it is undeniable that PLC optical splitters will become the mainstay of the PON market. They possess characteristics such as digitalization, networking, broadband, miniaturization, and ease of maintenance, making them a key focus of future market demand.
2. PLC (Optical Splitter) Market and Industry Situation
2.1 PLC (Optical Splitter) Market Situation
PLCs (Optical Splitter Connectors) are primarily used in Passive Optical Networks (PONs) access networks to connect central offices with multiple users, enabling fiber-to-the-home (FTTH). In 2008, global demand was approximately 24 million channels, with total sales of US$110 million, averaging US$4.6 per channel. The global market varies across regions. After several years of rapid growth, demand in Japan and South Korea has stabilized, but they still account for half of the market share. North America holds 30% of the market share. FTTH construction in developing countries such as China, India, and Brazil is just beginning and will become the main growth driver for the market.
In 2009, the Chinese optical device market experienced robust demand, particularly from the second quarter onwards, with sales revenue maintaining growth for three consecutive quarters. In terms of products, 10G optical modules and PLCs performed exceptionally well, showing strong growth. In the first and second quarters of 2010, domestic passive device manufacturers enjoyed a good order book, with market demand reaching approximately 600 million RMB, a year-on-year increase of 16%. Driven by operators accelerating the deployment of FTTX, the domestic PLC device market continued the strong growth momentum of 2009, with strong demand for products such as PLC splitters and AWGs. Currently, the market demand for passive devices such as fiber optic connectors, couplers, isolators, and attenuators is maintaining steady growth, but prices are declining due to further intensified market competition.
On the operator side, the three major operators have clearly required that all FTTX networks use PLC-type optical splitters. From 2009 to 2010, China Telecom and China Unicom conducted centralized procurement tenders for PLC splitters for two consecutive years. In 2010, China Mobile also began centralized procurement of all equipment used in GPON, including PLC splitters.
If the growth of the optical device market in 2009 was driven by 3G, then the growth factor in 2010 will be FTTX. Although there are still many obstacles to the large-scale deployment of FTTX networks in China, the government's decision to promote the convergence of telecommunications, broadcasting, and the internet will provide strong momentum for FTTX, and the optical device market will benefit from it. In the first half of 2010, driven by operators' active construction of FTTH and 3G networks, and following the State Council executive meeting chaired by Premier Wen Jiabao on January 13, 2010, which decided to accelerate the convergence of telecommunications, broadcasting, and the internet, the government began to promote the deployment of FTTX networks, which will benefit the optical device market. According to ICCSZ forecasts, the domestic optical device market will maintain steady growth in 2010, while the sales of passive optical devices will maintain rapid growth. In the second quarter, the sales of passive optical devices in China reached approximately 700 million yuan, a year-on-year increase of 17.8%. In the second quarter, the State Council issued the "Opinions on Promoting the Construction of Fiber Optic Broadband Networks," accelerating the construction of fiber optic broadband networks; currently, the pilot program for the convergence of telecommunications, broadcasting, and the internet has also been approved. These factors have effectively promoted further growth in the demand for optical devices and brought a large number of orders to passive optical device manufacturers. Currently, the deployment of FTTx networks in China is accelerating, and PLC products, as core components of FTTx, will also see widespread application. The demand for optical components in China is expected to reach 3.6 billion RMB, a year-on-year increase of 7.5%. It is anticipated that the Chinese optical component market will continue to grow in the second half of 2010.
A Brief Analysis of the PLC Splitter Market Technology
2.2 PLC (Optical Splitter) Industry Status
Currently, China is a major manufacturer of PLC devices, with most global products manufactured in China and South Korea. There are approximately 100 domestic companies capable of producing optical splitters (including foreign-invested enterprises), with about 20 possessing both production and R&D capabilities (according to China Telecom's 2010 PLC centralized procurement information, nearly 100 companies nationwide participated in the bidding). Among these, companies like Fiberhome Communications, Wuhan Accelink Technologies, Broadcom Technologies, Fucheng Optoelectronics, Aokang Optoelectronic Devices, Wuxi Aiwofu, Fuchunjiang Optoelectronics, Shenzhen Rihai Communications, Chengdu Feiyang Technology, Shanghai Shangcheng, Datang Communications (Kunshan), Nanjing Putian, and Zhejiang Pusen are engaged in large-scale production, manufacturing everything themselves except for outsourced chips. Apart from these, most other companies have not yet achieved significant scale in terms of product variety or production volume, and some essentially purchase the splitter body and then assemble it by adding jumper connectors and casings.
A Brief Analysis of the PLC Splitter Market Technology
Currently, countries around the world are vigorously promoting FTTH and FTTx projects. Domestically, with the deepening construction of FTTx (fiber optic access network), the market demand for PLC splitters is significantly increasing. PLC optical splitters are likely to be a key focus of the next phase of passive device market demand. Besides specialized optical device manufacturers increasing their development and production capacity, some well-known fiber optic cable manufacturers are also increasing their investment in this area, actively developing passive device products, and adding production equipment as a technological and product reserve to strategically and proactively capture the market. This demonstrates the importance of PLC optical splitters in the market over the next few years and the high level of attention given to this project by major optical device and fiber optic cable companies. However, China has not yet mastered chip technology and can only purchase chips for packaging or outsourcing.
2.3 PLC (Optical Splitter) Market Price Trends
In the future, China will dominate the PLC splitter market, and it is expected to account for 35% of the market in three years. Currently, the core technology chip of PLC splitter is still controlled by European, American and Japanese and South Korean companies. Domestic companies, lacking core technology, can only develop FiberArray, purchase chips for packaging or directly provide contract manufacturing services to chip companies.
Everything has two sides; increased demand is always accompanied by decreased product prices. Due to the influx of numerous domestic component packaging companies into this market, coupled with the three major telecom operators' centralized procurement of PLC optical splitters, market prices will face a downward trend. As demand continues to increase, prices will become increasingly lower, and the profits of OEM and packaging companies will become increasingly thin. Figure 1 shows the international PLC price trend.
A Brief Analysis of the PLC Splitter Market Technology
2.4 Problems in the Development of the PLC (Optical Splitter) Industry
The development of my country's PLC optical splitter industry also faces certain problems. Although market demand is large, the potential risks of oversupply and overcapacity are rapidly increasing. Firstly, manufacturing costs are mounting, especially for companies handling only coupling and packaging processes. The price of PLC optical splitters has dropped by about 40% compared to early 2008. Moreover, PLC splitters are relatively mature, and with large-scale production, prices and profit margins will continue to decline, making market consolidation increasingly apparent. Secondly, domestic manufacturers face homogeneous competition, relying entirely on imports for chips, V-grooves, and even fiber optic connectors, resulting in significant cost pressures. Smaller companies face even greater cost pressures because materials are mainly purchased externally, and costs are inversely proportional to purchase volume. Smaller purchase volumes result in higher prices, with differences ranging from 20% to 30%. Thirdly, WDM-PON is impacting PLC splitters. Besides EPON and GPON, fiber optic access technologies also include WDM-PON. The next generation of fiber optic access technology is likely to evolve into WDM-PON, and Europe and the United States are particularly enthusiastic about this technology. However, from a technical perspective, the existing EPON multiplexing method is power-splitting, while WDM-PON is wavelength division multiplexing. This means that existing PLC splitters are not suitable for WDM-PON technology. If this technological evolution is short-lived, current PLC splitter manufacturers will face severe challenges, and it will be difficult to recoup their equipment and capital investments.
3. Development of PLC (Optical Splitter) Technology
Low cost and high reliability are the basic requirements for optical splitters in FTTH projects. Optical splitters for optical communication can be mainly divided into two types in terms of technology: fused abdominis (FAB) type and planar integrated waveguide type.
Fiber fusion tapering (FTT) technology is the most mature technology for manufacturing 2×2 optical splitters. Currently, optical splitters are mainly all-fiber type, characterized by mature technology, convenient fiber connection, and low insertion loss. However, with the increase in the number of power splits, such as 1×8 and above, optical power splitters become larger, less efficient, more expensive, and exhibit poorer splitting uniformity. Furthermore, fiber optic splitters based on FTT have significant limitations in terms of passband and other characteristics.
PLC (Plug-in Logic Controller) is an integrated optical device based on planar technology. Unlike traditional discrete devices, it is fabricated using semiconductor processes, enabling the integration of optical components with different functions onto a single chip. It is a fundamental technology for achieving the integration, scaling, and miniaturization of optoelectronic devices. Compared to fused abbreviated taper (FAT) technology, planar waveguide technology offers significant advantages such as stable performance, low cost, and suitability for mass production. Therefore, fused abbreviated taper optical power dividers will no longer be used in future fiber-to-the-home (FTTH) systems, while planar waveguides provide an effective pathway for producing high-performance, low-cost optical devices for access networks.
3.1 PLC Chip Technology
PLC chips are generally fabricated on six materials: lithium niobate (LiNbO3), where waveguides are formed by diffusing Ti ions on lithium niobate crystals, resulting in a diffusion-type waveguide structure; group III-V semiconductor compounds, where waveguides use InP as the base and lower cladding, InGaAsP as the core layer, and InP or InP/air as the upper cladding, resulting in a buried ridge or ridge-shaped waveguide structure; SOI (Silicon-on-Insulator), where waveguides are fabricated on an SOI substrate, with the base, lower cladding, core layer, and upper cladding materials being Si, SiO2, Si, and air, respectively, resulting in a ridge-shaped waveguide structure; and other materials such as polymer, silicon dioxide (SiO2), and glass ion exchange.
While Fiber-to-the-Home (FTTH) network technology is no longer problematic, its rapid development and widespread adoption in my country, besides policy support, hinges on reducing costs across all network components. PLC optical splitters are a core component of FTTx networks, and low cost is a crucial technological development goal. Based on technical considerations, cost, and the waveguide material properties listed in the table above, silicon dioxide, polymers, and glass are the most suitable materials for manufacturing PLC chips. The following briefly introduces three PLC chip technologies with the lowest cost and easiest industrialization:
(1) Polymer (spin coating - etching)
Polymer waveguides use silicon wafers as the base and polymer materials with varying doping concentrations as the core layer, with a buried rectangular waveguide structure. Polymer waveguides and devices are simple and inexpensive to fabricate, and their production cost is theoretically even lower when used with photosensitive components, making them a promising technology. However, issues include the high cost of fluorinated materials; concerns about aging and relatively higher losses; and the need to consider their impact on product stability. Currently, only Shanghai NITTA Company offers optical splitters using this chip.
(2) Silicon dioxide
Silicon dioxide waveguides use silicon wafers as the substrate, with SiO2 materials of varying doping as the core and cladding layers, and the waveguide structure is a buried rectangle. Silicon-based silicon dioxide optical wave technology is a new technology developed in the 1990s and is relatively mature abroad. Its manufacturing processes include flame hydrolysis (FHD), chemical vapor deposition (PECVD, developed by NEC Corporation of Japan), plasma CVD (developed by Lucent Technologies of the United States), porous silicon oxide, and sol-gel. This type of waveguide has very low loss, approximately below 0.05 dB/cm. 60-channel and 132-channel AWGs have been developed abroad using this waveguide. Currently, flame hydrolysis (FHD) and chemical vapor deposition (PECVD) are commonly used for the growth of multilayer silicon dioxide materials, with dry etching technology used for waveguide etching. Its advantages include excellent physical and chemical stability, high device integration, and low cost. It also boasts excellent compatibility with optical fibers, low transmission loss, and a mature process (primarily reliant on imported equipment). The products are stable and reliable, and theoretically, it can also be used to manufacture other PLC devices such as AWG. This technology is currently the mainstream manufacturing technology for chip products and is widely used internationally. However, it suffers from high equipment investment and maintenance costs, and requires high-quality raw materials (all imported). Domestically, only a few research institutes and universities have online experimental equipment, and Wuhan Fiberhome Technologies has a silicon dioxide PLC process line; there is still no equipment available for large-scale industrial production. This technology and manufacturing are essentially monopolized by foreign manufacturers from South Korea and Japan.
(3) Glass-based (ion exchange)
Glass waveguides are formed by diffusing Ag ions onto glass material, resulting in a diffusion-type waveguide structure. The advantages include relatively simple processes and equipment, low total investment, and relatively stable and reliable products. The fabrication process of glass optical waveguides consists of five steps: 1) Sputtering a layer of aluminum onto a glass substrate as a mask layer for ion exchange; 2) Performing photolithography to protect the desired waveguide pattern with photoresist; 3) Removing the aluminum film from the top of the waveguide using chemical etching; 4) Immersing the masked glass substrate in a mixed solution containing Ag+-Na+ ions, and performing ion exchange at an appropriate temperature. The Ag+ ions increase the refractive index, resulting in a channel-type optical waveguide; 5) Applying an electric field to the channel-type optical waveguide to drive the Ag+ ions deeper into the glass substrate, resulting in a buried glass optical waveguide. The main issues with this technology are: ① Whether it will become a mainstream technology in the future is currently a concern for some experts; ② Because large-scale commercial and industrial production has not yet been achieved, the actual process stability of the product still needs to be verified.
Currently, only Teemphotonics (France) and Colorchip (Israel) internationally produce the aforementioned technology. It is said that E-TeK previously possessed this technology, but specific details are unknown and cannot be verified. Professor Wang Minghua's research group in the Department of Information and Electrical Engineering at Zhejiang University in China began collaborating with telecommunications companies several years ago to develop splitters based on glass ion-exchange optical waveguides, achieving some success. Their advantage lies in the complete maturity of their key technologies, the fact that all raw materials are readily available domestically, and the development of an optical splitter with performance indicators comparable to similar foreign products. Furthermore, all intellectual property rights are their own. Currently, commercialization and industrialization are not yet fully successful; intermediate testing and further refinement of technical parameters are required. Therefore, from an industrialization perspective, China's PLC chip manufacturing technology lags significantly behind that of foreign countries, and the process of practical application and industrialization still has a long way to go.
A Brief Analysis of the PLC Splitter Market Technology
3.2 PLC Fiber Array Technology
The output of the PLC beam splitter uses an array of fiber optic ribbons coupled to each output waveguide in the PLC. Each fiber in the ribbon is positioned using a V-groove to ensure that all waveguides can be automatically aligned with the ribbon in one go. The V-groove substrate can be made from a single-crystal silicon wafer through a selective wet etching process, or it can be made from a quartz glass plate through precision machining.
Because fiber arrays are fabricated using V-grooves and employ special bonding processes, precise fiber positioning and high reliability are achieved to meet diverse needs. The thermal expansion coefficient-matched packaging design ensures stress-free operation, high reliability, and no fiber displacement at high temperatures. Therefore, high-precision V-grooves and high-reliability UV adhesives are key technologies in the fabrication of fiber arrays.
Fiber optic array products can be made from either quartz glass or heat-resistant glass, but quartz glass plates are generally used and precision-machined. From a reliability standpoint, quartz glass is preferable, as it is less prone to cracking during polishing. The end-face polishing angle can also be customized according to customer requirements, such as 90 degrees, 98 degrees, 82 degrees, etc. The color and length of the fiber arrangement can also be customized according to customer needs.
Because fiber optic arrays are labor-intensive products, many foreign manufacturers have shifted production to China. Currently, domestic companies capable of independent R&D and production include Broadcom Technology, Fucheng Optoelectronics, Aokang Optoelectronic Devices, Dongguan Dongyuan, and Zhejiang Tongxing, while foreign companies primarily include Japan's Hataken and AIDI. China has also made breakthroughs in fiber optic array technology development and independent innovation, such as high-precision U-grooves using proprietary etching manufacturing processes. Once this technology is mastered and put into practical use, it will significantly reduce the cost of fiber optic arrays. Furthermore, square capillary arrays exhibit excellent characteristics in AWG and single-channel arrays.
High-reliability UV adhesives are another key technology in the fabrication of fiber optic arrays. The manufacturing process of optical splitters places high demands on fiber optic arrays; besides requiring high precision V-grooves, the UV adhesives must also possess properties such as resistance to high temperatures and humidity and sufficient hardness. Currently, the series of composite products developed and manufactured by NTT-AT Corporation of Japan are the most technologically advanced, and China still lacks expertise in this area.
3.3 PLC Coupling and Packaging Technology
Besides the chip and fiber array, another key technology of PLC optical splitter is the coupling and packaging between the chip and the fiber, which involves the six-dimensional tight alignment of the fiber array and the optical waveguide.
The packaging of a PLC splitter refers to the technique of aligning each light guide path (i.e., waveguide path) on the planar waveguide splitter with the optical fibers in the fiber array, and then bonding them together with a specific adhesive (such as epoxy). The alignment accuracy between the PLC splitter and the fiber array is crucial to this technology. The packaging process includes coupling alignment and bonding operations. There are two methods for coupling alignment between the PLC splitter chip and the fiber array: manual and automatic. These methods rely on hardware such as a six-dimensional precision fine-tuning frame, a light source, a power meter, and a microscopic observation system. Automatic alignment is the most commonly used, as it uses optical power feedback to form a closed-loop control, resulting in high alignment accuracy and coupling efficiency. Currently, the most advanced coupling alignment equipment suppliers abroad include Suruga Seiki (Japan), Kuge Seiki (Japan), and Newport (USA). Domestic companies have also developed their own equipment, but their six-dimensional accuracy cannot meet the coupling requirements.
With the significant increase in demand for optical splitters for FTTH (Fiber to the Home) systems, the domestic PLC device packaging industry has developed rapidly. Key representative companies with scale and R&D capabilities include Broadcom Technology, Fucheng Optoelectronics, Accelink Technologies, Sunsea Avionics, Wuxi Aiwofu, Fuchunjiang Optoelectronics, Chengdu Feiyang, Datang Telecom (Kunshan), Zhongshan Aokang AgileCom, and Shanghai Shangcheng, among others. Many more optical device companies and some fiber optic cable companies have already launched or are in the process of launching PLC optical splitter packaging projects. Because the packaging technology for optical splitters is relatively simple and requires relatively low investment (around 200,000 RMB for a manual alignment system), projects are relatively easy to complete. Currently, many high-value-added PLC device products require specialized and proprietary packaging technologies; domestic packaging manufacturers need to increase their R&D and investment in this area.
