The shift signals a significant departure from traditional copper infrastructure, which is being sidelined in favor of passive fiber distribution. According to new research from the Dell’Oro Group, 2026 revenues for data center PON equipment are poised for an 844 percent year-over-year increase. By adopting point-to-multipoint technologies for out-of-band management networks, operators aim to reduce long-term operational costs.
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Hyperscalers Drive PON Surge in Data Center Infrastructure
Data center spending on Passive Optical Network equipment is projected to climb at a 52 percent compound annual growth rate through 2030. Driven by hyperscalers seeking to slash cabling complexity and power consumption, the technology is rapidly migrating from residential use into the core of modern enterprise and cloud infrastructure.
Jeff Heynen, Vice President of Broadband Access and Home Networking at Dell’Oro, notes that the hardware provides a lower-cost alternative that maintains value longer than legacy cabling. Cumulative spending in this sector is forecast to surpass $3 billion over the next four years. Beyond hyperscalers, the trend extends to neocloud and colocation providers, alongside enterprises investing in Passive Optical LANs to support increased data speeds within their facilities.
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