China’s Optical Communication Market Trends in 2025
China’s optical communication market is poised for another leap forward in 2025. Driven by the explosive growth of data traffic, the evolution of 5G-A, and national initiatives such as East-to-West Computing Resource Transfer, optical network technology is advancing rapidly, with continuous innovations and emerging applications. From core backbone networks to data centers, from 5G transport to PON access, every technological breakthrough is reshaping the industry landscape and steering the global telecommunications sector toward a new era.
1. The Leap in High-Speed Optical Communication
High-speed optical communication technology is stepping into the ultra-fast era. 400G WDM will enter large-scale commercial deployment in 2025, serving as the backbone technology for long-haul networks, metropolitan networks, and Data Center Interconnect (DCI). Chinese operators have already started network trials and are focusing on optimizing long-distance transmission. By incorporating G.654.E ultra-low-loss fiber and 130+ GBaud coherent modulation technology, transmission efficiency will be enhanced while reducing per-bit cost.
Meanwhile, 800G WDM is set to enter the trial commercialization phase, with initial applications focused on short-range DCI scenarios such as supercomputing center interconnection. Future breakthroughs in silicon photonics integration, low-power DSPs, and C+L band expansion will drive the evolution toward 800G and beyond, providing robust support for the massive data demands of the AI era.
2. The Deep Evolution of 5G Transport Networks
With 5G advancing into its next phase, the upgrade of transport networks is imperative. 5G backhaul and midhaul networks are transitioning to 400G interfaces, ensuring low-latency and high-reliability services (such as Industrial Internet applications). The integration of SRv6+EVPN protocols enables intelligent network operation and maintenance, while AI-driven solutions facilitate fault prediction and dynamic bandwidth adjustments. Additionally, the trend of open and disaggregated architectures is accelerating, with white-box equipment and open optical layer architectures reducing capital expenditures (CAPEX) for telecom operators and enhancing network flexibility.
In 5G fronthaul, semi-active WDM solutions (such as China Mobile’s Open-WDM) have become mainstream, supporting 25G/50G transmission rates for cost-effective and scalable deployments. Meanwhile, in low-density rural areas, passive CWDM continues to play a complementary role. Some scenarios are transitioning to eCPRI, reducing fronthaul bandwidth pressure and optimizing the 5G RAN architecture.
3. Small-Granularity OTN Unlocking the Era of “All-Optical Infrastructure”
OSU (Optical Service Unit), an essential part of the ITU-T G.709.25 standard, will enter large-scale commercial deployment by 2025. It supports flexible service access ranging from 2Mbps to 100Gbps, catering to differentiated demands in government and enterprise leased lines, such as finance and public administration. With strict isolation mechanisms, it ensures high security, and latency commitments can reach the microsecond level.
Additionally, Fine-Grained OTN (fgOTN), combined with SDN architectures, is accelerating the transition of OTN networks toward an all-optical infrastructure, supporting cloud-network convergence scenarios such as edge computing interconnectivity. However, to achieve widespread adoption, progress in standardization and industry chain maturity must be expedited.
4. The Advancement of PON Networks
With gigabit broadband becoming mainstream, 10G PON (XGS-PON) is expected to cover major cities in China, with penetration exceeding 60% by 2025. It will play a crucial role in supporting the “Dual Gigabit” strategy, with applications spanning 8K/VR home broadband, enterprise leased lines, and smart city implementations (e.g., video surveillance backhaul).
Looking ahead, 50G PON is moving toward commercialization, with ITU-T G.9804 standards expected to be finalized in 2024, followed by pilot deployments in 2025. Initial applications will focus on Industrial PON (e.g., smart manufacturing) and high-end enterprise leased lines. While challenges remain in ODN compatibility and cost-effective optical module development, 50G PON is set to become the next-generation standard for optical access networks.
In addition, F5G (Fifth-Generation Fixed Network) is expanding beyond residential broadband to industries such as healthcare, education, and industrial automation, with the vision of “All-Optical Connectivity.” Combined with Wi-Fi 7, it promises an end-to-end 10G experience, laying a solid foundation for the digital economy.
5. The Transformation of the Optical Module Market
Optical modules, as core components of optical networks, are evolving toward higher speeds and improved efficiency. By 2025, 800G optical modules (OSFP/QSFP-DD) are projected to account for over 30% of the market, while 1.6T modules will enter the research and development phase. The rise of AI-driven computing centers is accelerating the adoption of Co-Packaged Optics (CPO), significantly improving power efficiency.
China’s silicon photonics ecosystem is maturing, with industry leaders like Huawei and Accelink Technologies making breakthroughs that lower the cost of 400G/800G optical modules. Meanwhile, LPO (Linear Pluggable Optics) is gaining traction in data centers due to its low-power consumption, though long-distance transmission challenges still need to be addressed. Additionally, AI clusters (e.g., GPU/TPU interconnects) are driving optical modules toward low-latency, high-density architectures, including the development of 3.2T CPO switches. Meanwhile, all-optical interconnects (such as OXC technology) are optimizing east-west traffic within data centers, enabling more efficient cold and hot data tiering.
HTF: A Leader in Optical Communication Innovation
Amid this wave of technological transformation, HTF stands out as a key industry leader. As a global provider of fiber optic products and WDM system solutions, HTF leverages its extensive expertise to drive the commercialization of 400G/800G optical transmission systems, delivering cost-effective and high-performance solutions for telecom operators and data centers.
HTF’s HT6000 OTN transmission system, known for its compact size, high capacity, and cost efficiency, has become one of the industry’s most competitive transport platforms. Additionally, HTF’s product portfolio—including optical modules, VOA variable optical attenuators, and OEO converters—is widely deployed in backbone networks, data centers, and 5G transport infrastructures. Looking ahead, HTF remains committed to innovation, pioneering next-generation solutions that will shape the future of global optical communication, driving the industry toward a faster, smarter, and more connected era.
