The global Data Center Interconnect (DCI) market is experiencing rapid expansion as generative AI services proliferate across telecommunications networks in 2025.
According to a TrendForce report, major telecom providers like SK Telecom and Deutsche Telekom are actively deploying Agentic AI services, increasing the demand for DCI technology that facilitates high-speed data transmission between data centers. The DCI market is projected to grow 14.3 percent year-over-year, exceeding US$40 billion by the end of 2025.
DCI technology, essential for alleviating the computational load generated by AI data processing, is gaining momentum through strategic partnerships between optical communication equipment manufacturers and telecom operators.
US-based Ciena is leading in DCI deployment, collaborating with Telia, e&, and Arelion to implement its Wavelength Logic6 Extreme solution. Meanwhile, Nokia is expanding its DCI reach in emerging markets such as Saudi Arabia and Vietnam, leveraging its PSE-6s optical engine to achieve terabyte-level inter-city data transmission.
As DCI adoption intensifies, the demand for high-capacity optical transceiver modules is also rising. The shift from 400G to 800G and eventually to 1.6T modules is evident, with the latter still in its early stages of production.
Taiwanese optical component suppliers such as Browave Corporation and LUXNET Corporation are capitalizing on the growing demand for wavelength division multiplexers (WDMs) and optical transceivers. Additionally, Taiwanese network equipment providers like Accton, Sercomm, and WNC are enhancing their DCI switch solutions to cater to expanding US telecom and CSP markets.
The expansion of DCI infrastructure is reshaping the global telecom industry, with regional markets such as Southeast Asia and the Middle East emerging as key areas of focus. As generative AI continues to drive computational demands, investment in high-speed data transmission solutions will likely accelerate, propelling the DCI market to new heights in the coming years.
TelecomLead.com News Desk
