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Broadband deployment in rural areas and AI applications are driving the optical transceiver market. In 2024, AT&T expanded fiber networks in the U.S., increasing demand for optical components. Integration challenges with legacy systems slow adoption.

Meta and Microsoft are deploying advanced optical modules in their data centers in 2025. North America leads the market, while Asia-Pacific experiences rapid growth due to fiber-optic initiatives. Major players include Broadcom and Cisco, with innovations in co-packaged optics and quantum communication enhancing future connectivity.