$6.5 billion IR light sources market by 2023
The development of new and smart functionalities in smartphone, medical and automotive applications as well as the development of breakthrough devices and functions such as wearables and virtual reality are pushing the growth of the IR LEDs and laser diodes industry. The IR light source market is expected to reach $1.8 billion in 2018 and increase to $6.5 billion in 2023 with an impressive 29 percent CAGR during this period, according to the market research company Yole Développement in its latest IR LEDs & Laser Diodes technology and market report.
"More than 40 different applications have been identified as integrating IR solid state light sources", explains Pierrick Boulay, technology and market analyst from Yole Développement. "Among these, some are expected to make the IR LED and laser diode markets boom in the next five years," he adds.
Optical communication, one of the oldest IR light-source applications, is still expected to be one of the major drivers in the coming years. Indeed, the amount of data exchanged on the internet is exploding, and will continue to do so with the emergence of the IoT , cloud-based services, autonomous cars, and more.
Driven by additive manufacturing, industrial applications are also expected to generate high revenue in the coming years. Traditional IR light sources that emit light in all directions and consume large amounts of energy are starting to be replaced by VCSEL that can be individually controlled, resulting in lower energy consumption.
After Apple, some key Android-based smartphone manufacturers are following a similar strategy and starting to release new products. Pars Mukish, business unit manager, solid-state lighting and display at Yole comments:"3D sensing is not limited to smartphones. It also has potential for automotive LiDAR, which is necessary for the development of ADAS. Not surprisingly, many start-ups in this field have entered the market in order to develop this technology and join the coming revolution."
Finally, 3D sensing is expected to be the killer application for IR light sources. VCSEL's integration in the iPhone X for facial recognition has generated much interest in 3D sensing: "In 2017 Apple released the iPhone X, with a 3D sensing function based on this technology," asserts Boulay. "It integrates three different VCSEL dies for the proximity sensor and the Face ID module, and made the VCSEL market explode in 2017, propelling overall revenue to about $330 million."
Initially developed for optical communication applications, LED and laser diodes are now integrated into high-value functions. These technologies are part of a new revolution, with each one finding its own path:
"¢ Initially focused on low-end applications (photo interrupters, remote controls, etc.), IR LEDs are now increasingly implemented into smartphones for proximity sensing; automotive for gesture recognition; and VR/AR headsets for eye tracking.
"¢ For market for edge emitting lasers (EEL) has historically been driven by optical communication applications. This is likely to continue, given the always-increasing amount of data exchanged with optical fibre networks. However, in the mid-term the technology may also find strong growth in new applications, such as LiDAR. Yole's analysts had the opportunity to discuss with Joerg Strauss, head of the emitter laser and sensor segment at Osram Opto Semiconductors to share their vision of the industry and get a deep understanding of the development of EEL-based solutions: "We believe within Osram that EEL laser will continue to be beneficial compared to VCSEL in LiDAR applications. Primary reason is the required laser power for LiDAR which is hard to achieve with a reasonable light emission area by VCSEL technology," explains Strauss.
"¢ Today, VCSEL might be the fastest-growing technology. Having originally found its sweet spot in short distance data communication, Apple's 2017 release of the iPhone X has completely changed the business landscape
Yole companies including Yole Développement, System Plus Consulting and Knowmade will hold a free webcast on October 31 dedicated to the VCSEL industry: 'VCSEL: After 20 years, has the technology finally found its killer application?' Speakers will include Pars Mukish from Yole, Romain Fraux, CEO at System Plus Consulting and Paul Leclaire, Knowmade's patent and technology analyst.
