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Value of infra-red LED & laser diode market to triple by 2022: Yole

Value of infra-red LED & laser diode market to triple by 2022: Yole

June 2, 2017: The market for LED and laser infra-red (IR) light sources is not new, but has evolved rapidly with the recent development of Solid State Lighting (SSL). Initially developed for optical communication applications, these technologies, mostly IR LEDs, started to be integrated into consumer applications like remote controls in the 1980s. Next, the market was driven forward by night vision applications such as surveillance cameras. But it’s only recently, with the development of smartphones, that IR LEDs and lasers have come back to prominence. And now, the market is set for growth for the next 10 years!

Today, these technologies are part of a new revolution, still driven by smartphone applications. Integration of breakthrough functionalities such as 3D imaging, autofocus, iris and face recognition is triggering a strong market pull for efficient, miniaturized and complex IR illumination. This trend will also create strong market opportunities for IR lasers, mostly VCSELs, which allow more coherent and directional light than IR LEDs. In this context, we expect the IR light source market to grow from around $450M in 2016 to around $1,550M in 2022 at a compound annual growth rate of 22.7%.

In addition, there are also several other applications that are emerging and for which a market boom is likely to happen in the next 10 years. These include gas sensors, LIDARs, driver monitoring systems and remote patient monitoring sensors. We expect this second wave of new applications to propel the IR light source market to around $3,800M in 2027.

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This report provides an in-depth analysis of all IR light source applications, including: basic principles, technology, trends, key players, and market size. It highlights the global landscape for IR light sources, including classification of applications by wavelength, market segment and function. Detailed market forecasts are given based on these classifications and with complementary analysis by light source for LEDs, edge-emitting lasers and VCSELs. Please note that optical communication applications are not analyzed in this report.

VCSEL TECHNOLOGY WILL BE AT THE HEART OF THE INDUSTRY IN COMING YEARS

In a depressed visible LED industry, manufacturers are looking at new opportunities to increase their revenues and margins. In this context, the IR LED market is perceived as a potential new ‘blue ocean’ with attractive opportunities for those players. In the past, only a handful of companies were involved in IR LEDs but, as of Q1 2017, there are more than 40 manufacturers. Osram and Vishay still lead the field but some players, like Everlight or Epistar, have made large investments to benefit from this opportunity.

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While LEDs are important, VCSEL technology is the really hot topic. IR LEDs represented around 65% of the IR light source market in 2016, but this figure is likely to decrease to 45% in 2022. Development of 3D cameras and autofocus applications, associated with the sensor fusion trend in smartphones and automotive, will strongly drive growth of the IR VCSEL market in the future. The main advantage of this emerging technology is that it represents a good compromise between traditional laser diodes, providing coherent and directional light, and IR LEDs, offering lower manufacturing cost and ease of integration. Additionally, IR VCSELs allow new sensing approaches, such as Time of Flight (ToF). In this context, the IR VCSEL industry will be at the center of the attention and should experience strong growth in coming years. It is also likely that some players will work on both IR LEDs and lasers to maximize their revenues.

Opportunities for both technologies will also be dependent on developments to overcome current limitations, towards longer wavelengths, higher performance, multi-spectral functionality and lower cost. Typically, most current IR LEDs are in the 850nm or 940nm range. To enable emerging applications such as gas sensors or portable/integrated spectroscopy systems, longer wavelengths will be mandatory.

Last but not least, integration of these light sources into sensors and modules will also be part of the challenge to be handled by the photonics industry.

This report presents an analysis of IR LEDs and VCSELs, including a map of manufacturers, insights on manufacturing processes and technology, current limitations and challenges. It also describes IR system roadmaps in key markets segment such as smartphones and automotive.

IR light sources market shares Yole report

EVERYTHING IS HAPPENING IN PHOTONICS PACKAGING: WE ARE AT THE EVE OF AN INDUSTRIAL RESTRUCTURING

For a few years there has been an increasing interest in photonic devices, sensors and modules including systems with IR illumination in a wide range of applications such as consumer, automotive and medical. However, photonics is radically different from electronics when it comes to packaging and integration, and has its own challenges.

Today, there is no “structured” photonic supply chain or industry, and different strategies are starting to emerge to catch the maximum value of this high potential market. Should there be smarter devices? Smaller devices? This will soon be a multi-billion dollar industry. And, depending on current positioning and attraction toward this emerging market, each player may have different strategies to capitalise on it. For example, ams, through the acquisition of Heptagon and Princeton Optronics, is now fully vertically integrated. Recent rumors that STMicroelectronics’s single photon avalanche diode (SPAD) imager is likely to be linked to the iPhone 8 highlights that the company is enforcing its position of heterogeneous integrator as no clear standard approach or technology has emerged yet. Some players like the optics supplier Largan are betting on specialization.

Who will develop the right strategy? It’s too early to know. However, what is sure is that the industry is evolving. And those who don’t adapt accordingly might not be around to enjoy its lucrative-looking future.

This report analyzes integration of IR light sources into sensors and modules, detailing technology and industry trends based on case studies.

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