The rapid build-out of AI infrastructure is reshaping the optical transport market, with a growing emphasis on ZR+ coherent pluggable optics and IP-over-DWDM architectures. According to a new report from Dell’Oro Group, the IPoDWDM market is projected to grow at a 27% CAGR through 2030, surpassing $7 billion in annual revenue. The firm expects a major shift toward ZR+ optical modules as hyperscalers deploy “scale-across” data center interconnect (DCI) networks to link large AI training clusters across multiple facilities.
Dell’Oro said AI infrastructure deployments are accelerating demand for optical transport equipment across metro and long-haul networks. While traditional front-end DCI applications continue to expand, the emergence of scale-across architectures is creating a new category of optical connectivity requirements. These deployments connect multiple AI data centers into larger training environments, increasing the need for high-capacity coherent optics that can operate directly from routers and switches without dedicated transponder equipment.
Demand for IPoDWDM accelerated during the first quarter of 2026, driven primarily by 800G ZR+ optics. Dell’Oro estimates IPoDWDM revenue increased more than 30% year-over-year during the quarter. The report also highlights strong momentum for disaggregated WDM architectures, which include ZR/ZR+ pluggables, optical line systems, and transponder platforms. The disaggregated WDM segment grew approximately 50% year-over-year in 1Q26 and is forecast to approach $13 billion by 2030.
• IPoDWDM market forecast to exceed $7 billion by 2030, growing at a 27% CAGR.
• ZR/ZR+ optical pluggable module shipments are forecast to grow at a 29% CAGR over the next five years.
• Dell’Oro estimates IPoDWDM revenue grew more than 30% year-over-year in 1Q26.
• Cisco (via Acacia) led ZR/ZR+ module shipments during 1Q26.
• Marvell Technology held the second-highest ZR/ZR+ shipment share.
• The disaggregated WDM market grew approximately 50% year-over-year in 1Q26.
• Ciena maintained the leading share of the disaggregated WDM market at roughly 40%.
• Nokia held the second-largest share in the disaggregated WDM market.
“Without a question, AI is driving the market demand for optical transport equipment, especially ZR/ZR+ optics for IPoDWDM,” said Jimmy Yu, Vice President at Dell’Oro Group. “The next big thing is scale-across DCI, or connecting the back-end of AI data centers, to form larger AI training facilities.”
