DARK FIBER MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2024-2031)
The Dark Fiber Market is estimated to be valued at USD 7.17 Bn in 2024 and is expected to reach USD 16.06 Bn by 2031, exhibiting a compound annual growth rate (CAGR) of 12.2% from 2024 to 2031.
The market is expected to witness significant growth over the forecast period. The rising demand for internet connectivity and data transfer across various industries due to digital transformation initiatives is driving the demand for dark fiber networks. Additionally, the growing demand for carrier-neutral interconnection and bandwidth services among businesses is propelling the market growth.
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Various technological advancements in the telecommunication industry, such as the adoption of 5G networks and increasing investments by telecom providers as well as IT & consulting companies in developing advanced fiber infrastructure are expected to present lucrative opportunities for the key players in the market during the forecast period.
Increasing Demand for High Bandwidth Connectivity
With increasing smartphone and internet usage, bandwidth demand has been growing exponentially in recent years. People no longer just access basic internet on their phones and computers - they now stream high-definition videos, make video calls, engage in online gaming, and more. This boom in bandwidth-hungry applications has drawn attention to technologies that can help expand network capacity to meet future needs. As a result, many enterprises and data center owners are considering the installation of dark fiber networks within and between their facilities to ensure high-speed connectivity now and in the future. Dark fiber offers literally unlimited bandwidth potential since fiber cables are not put to active use until laser transmitters and receivers are installed on either side. The upfront cost of laying dark fiber is also offset by its future-proofing ability and long lifespan of over 25 years.
For instance, Colt Technology Services, a telecommunications company, offers a dark fiber network to around 1,000 data centers in Europe and Asia. The company’s dark fiber provides businesses with maximum levels of flexibility and control to support virtually unlimited bandwidth.
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Deployment of 5G Networks and Edge Computing
The rollout of 5G networks and edge computing architectures are serving as key growth drivers for the dark fiber market. 5G promises ultra-low latency communications which will enable innovative applications like augmented/virtual reality and self-driving vehicles. However, to achieve the latency targets, data networks need to be brought closer to the edge to reduce round trip times for data. This is driving more deployment of edge data centers within cities. Since 5G small cells and edge data centers will be located much closer to the end users, high fiber counts will be necessary to backhaul all the data to the core networks. Laying new fiber trunk routes to support these distributed edge infrastructures makes economic sense compared to relying on existing fiber networks. Also, 5G speeds of over 1Gbps will test the bandwidth limits of existing networks. Thus, operators are considering installation of dark fiber to prepare for 5G and edge computing driven bandwidth growth. This ensures service providers as well as enterprise customers have the fiber capacity they need for smooth migration to 5G technologies. For instance, according to Coherent Market Insights’ analysis, 5G will account for as many as 1.5 billion connections by 2025.
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Market Challenges: High initial Investment Requirements
The market faces several challenges. As dark fiber infrastructure requires massive upfront capital investments, concerns around revenue stability and return on investment discourage expansion. Additionally, low fiber utilization and lack of standardization increase complexities in integrating new networks. Regulatory barriers regarding right of way and permitting present delays. Suppliers also confront challenges in attracting customers and converting them from existing service providers due to customer reluctance over managing their own networks.
Market Opportunities: Rising Demand from Healthcare and Education Sectors
Demand for dark fiber is rising from businesses seeking dedicated high-bandwidth connectivity and carriers to support 5G rollouts. As network traffic spikes, enterprises are more open to dark fiber solutions to ensure quality of service. New customers from sectors like healthcare, education, and financial services increase addressable market. Suppliers can capitalize on opportunities by leasing bandwidth to multiple tenants for steady revenue streams.
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Insights, by Fiber Type - Multimode Fiber Drives Adoption with Growing Bandwidth Needs
Multimode fiber is estimated to hold the highest share of 68.6% in 2024 in the dark fiber market owing to its ability to meet growing bandwidth requirements at relatively lower costs. As data consumption across organizations and industries continues to surge exponentially, the demand for higher bandwidth connectivity is also rising. However, deploying single mode fiber networks to increase bandwidth comes with significant infrastructure upgrade expenditures. Multimode fiber provides a cost-effective alternative to support the transmission needs of most applications today. It enables faster rollout of networks to new sites without substantial upfront capital investments.
Multimode fiber's tolerance for Signal Degradation allows easier and lower-priced deployment for enterprises and telecom operators. Multiple light signals can propagate through the same fiber strand simultaneously via different angles. This helps accommodate bandwidth spikes and congestion periods. Compared to single mode fiber, signal amplification is easier with multimode fiber over short and medium haul distances. Components and equipment are also more standardized and widely available due to broader use, reducing deployment timelines.
Advent of advanced multimode fiber types like OM4 and OM5 have further increased their competitiveness. Newer generations support transmission over longer distances at higher speeds while maintaining legacy compatibility. This provides bandwidth headroom for future needs. Transition to next-gen multimode fiber involves relatively minor upgrades compared to complete overhauling required for single mode fiber networks. Their backward compatibility retains existing infrastructure investments.
Insights, by Network Type - Catering to Vast Geographies, Long-haul Networks See Strong Demand
The long-haul segment is estimated to hold the largest share of 58.8% in 2024 in the market as operators extensively leverage terrestrial and submarine cables to interconnect vast geographic areas. Long-haul networks play a critical role in bridging domestic and global telecom infrastructures to facilitate seamless data flows. Growing cross-border data transfers between enterprises and rise of hyperscale cloud/content providers have accelerated the need for high-capacity inter-regional connectivity.
Long-haul networks efficiently transport data traffic across thousands of kilometers while minimizing transmission impairments over extended spans. Advanced digital signal processing and optical amplification technologies help overcome loss and dispersion challenges over such long routes. This allows seamless scalability to cater to future traffic volumes.
Terrestrial networks connect major cities and business hubs within countries through an extensive layered overlay of metropolitan and regional backbones. Undersea cables act as critical international backbones interlinking countries underwater through oceans. They serve as major global data arteries connecting entire continents and regions. High count of fiber strands allow meeting explosive bandwidth deluge between nations driven by cloud, video and mobile data usage.
For instance, Fermaca Networks, a leading provider of long-haul dark fiber infrastructure, is set to launch a new long-haul dark fiber route in Mexico in 2025, which will be the newest and longest long-haul dark fiber route in Mexico in 20 years.
Insights, by End-use Industry - Driving Digital Transformation, Telecom Emerges as Key End User
The telecom segment is estimated to capture the largest share of 44.6% in 2024 in the market owing to rapid digitization initiatives of leading operators. Telecom providers are extensively investing in high-bandwidth network infrastructures to accommodate surge in data traffic from 5G, IoT, MVNOs and OTTs. Dark fiber plays a strategic role in boosting network capacities of telcos in support of their long-term digital roadmaps.
Telcos are augmenting metro capacities to support small cell densification for 5G services. They are also upgrading regional and long-haul backbone routes to interconnect expansive 5G radio access networks seamlessly. This allows delivering consistent high-speed connectivity demanded by emerging applications. Dark fiber networks help future-proof existing infrastructure for upcoming technologies like 5G standalone networks, AI/ML, and edge computing.
Leading operators are deploying dark fiber to private enterprises, real estate properties and data centers as part of their connectivity services portfolio. Such locations aggregate massive data usage from users, requiring persistent high-bandwidth access. Dark fiber enables provisioning ultra-fast dedicated links of 10Gbps up to 100Gbps on-demand to such locations. This drives new revenue streams for telcos in hyperconnectivity era.
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North America has established itself as the dominant region and is estimated to hold the largest share of 34.2% in 2024 in the in the dark fiber market. It has a well-developed telecommunications infrastructure with widespread Fiber-to-the-Home connectivity. Key telecom carriers such as Verizon and AT&T have invested heavily over the years to lay extensive metro and long-haul fiber networks across major cities. They lease out surplus capacity in the form of dark fiber to enterprise and wholesale customers. Several large native dark fiber providers such as Zayo and Level 3 have a strong presence in the region with metro networks in major commercial hubs. The North American region hosts headquarters of prominent colocation providers like Equinix and Digital Realty who have made significant investments in procuring dark fiber to expand their footprint. The demand from cloud providers and content delivery networks for high-bandwidth connectivity infrastructure has also encouraged growth of fiber networks.
Coming to the fastest growing region, Asia Pacific has shown tremendous potential in recent times. Rapid digitization and growth in internet usage are driving requirements for high-speed connectivity. Several countries like China, South Korea, and India are offering favorable policies and incentives to develop open-access fiber networks. Chinese giants like Dr. Peng Telecom and China Unicom have expanded nationwide fiber infrastructure along railway tracks and are attracting international carriers and internet companies. In India as well telecom companies like Jio and Airtel are rolling out pan-India fiber networks. Across Southeast Asian markets, demand from data centers, cloud exchanges and internet hubs is contributing to uptake of dark fiber. Countries are easing right of way regulations to construct metro and long-distance optical networks. The regional market is expected to grow at an accelerated pace due to ongoing investment in undersea cables and terrestrial backbone builds over the coming years.
Dark Fiber Market Report Coverage
| Report Coverage | Details | ||
|---|---|---|---|
| Base Year: | 2023 | Market Size in 2024: | US$ 7.17 Bn |
| Historical Data for: | 2019 To 2023 | Forecast Period: | 2024 To 2031 |
| Forecast Period 2024 to 2031 CAGR: | 12.2% | 2031 Value Projection: | US$ 16.06 Bn |
| Geographies covered: |
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| Segments covered: |
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| Companies covered: |
AT&T Inc., Colt Technology Services Group Limited, Comcast, Consolidated Communications, GTT Communications, Inc, Lumen Technologies, Inc., Verizon Communications, Inc., Windstream Intellectual Property Services, LLC, Zayo Group, LLC, Microscan, Sorrento Networks, NexGen Networks Corporation, UFINET, Vikram Group, DEPL, UNITE PRIVATE NETWORKS, Sterlite Power, Crown Castle, FirstLight, and Cologix |
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*Definition: Dark fiber refers to unused optical fiber that has been installed but is not 'lit', or in use. In the dark fiber market, telecom providers lease these unused fiber strands to businesses and network operators on an indefeasible right of use basis. The lessee is then responsible for 'lighting' the fiber by installing their own network equipment to transmit signals and make use of the fiber connectivity. They can establish high-speed network connections between buildings, cities or states using the leased dark fiber.
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About Author
Yash Doshi is a Senior Management Consultant. He has 12+ years of experience in conducting research and handling consulting projects across verticals in APAC, EMEA, and the Americas.
He brings strong acumen in helping chemical companies navigate complex challenges and identify growth opportunities. He has deep expertise across the chemicals value chain, including commodity, specialty and fine chemicals, plastics and polymers, and petrochemicals. Yash is a sought-after speaker at industry conferences and contributes to various publications on topics related commodity, specialty and fine chemicals, plastics and polymers, and petrochemicals.
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