Propelled by the AI-driven buildout of data center interconnect, WDM pluggable optics now lead the telecom market in bandwidth deployed.. Beginning in 1Q26, Cignal AI has expanded its IP-over-DWDM coverage with a new WDM Pluggable Applications Forecast, a new overlay dataset in the Transport Hardware Report.
This article introduces the forecast, its structure, and what it tells us about where pluggable revenue is headed through 2030.
Background
The predecessor IP-over-DWDM Report focused on one question: how much coherent revenue is hosted within routers and switches? That framing captured the original use case, but it grouped standalone modules (see WDM Pluggables – Hardware Report) together with router-attached optics rather than distinguishing the two, and it omitted a third application entirely: pluggable transponders in optical transport systems (see Pluggable Transponders – 3Q25). The WDM Pluggable Applications Forecast covers all these applications, forecasting revenue across three procurement models, three customer market segments, and six categories of coherent pluggable optics through 2030.
Cignal AI’s Optical Components Report includes detailed shipment forecasts for every type of coherent interface, while the WDM Pluggable Applications Forecast in the Transport Hardaware Report provides a single, coherent view of pluggable revenue, reconciled with the WDM Pluggables, Optical Hardware, and Routing Hardware segments of the Transport Hardware Report, so the shift from embedded to pluggable optics, and their astounding growth trajectory, can be tracked wherever it lands.
Three Procurement Models
Whereas IP-over-DWDM focused on router-hosted optics, the Pluggable Applications Forecast tracks how each module is deployed and where its revenue lands within the broader Hardware Report.
Router attached
Optics procured with, and hosted within, routers. Within the Hardware Report, this revenue sits in Routing Hardware (Core, Edge, or Aggregation). This is the classic definition of IP-over-DWDM and remains the most common consumption model among non-Hyperscalers. We forecast router-attached revenue rising from roughly $257M in 2025 to $905M in 2030.
Optical-attached
Coherent pluggables procured with, and hosted in, optical transponders, specifically pluggable or “thin” transponders. This revenue is captured in Optical Hardware (Metro or Long Haul). It is the smallest of the three models today but the fastest growing, expanding from about $43M in 2025 to $564M in 2030; a 67% CAGR, as vendors standardize on pluggable line interfaces across their transport platforms.
Standalone
Coherent pluggables procured independently of the host platform, almost exclusively by hyperscalers and large Service Providers for use in routers and ethernet switches. This category maps to the WDM Pluggables segment of the Hardware Report and is by far the largest, growing from roughly $1.7B in 2025 to over $6.0B in 2030 and accounting for more than 80% of total Pluggable Applications revenue. (NOTE: Pluggables sold from a module vendor to another hardware company for OEM resale are omitted to prevent double counting. The end-user sale is assigned to the hardware vendor that is the reseller.)
Three Customer Markets
WDM Pluggable Applications revenue is forecast across the same three customer markets covered in the primary Hardware and Markets Report. The dynamics differ significantly by segment.
Cloud & Colo
Hyperscalers have been, and will remain, the driving force behind pluggable coherent adoption. Their massive DCI demands and operational competence are perfectly matched to the router/switch-hosted application, and the maturation of 400ZRx fortuitously coincided with the AI spending boom. 800ZRx optics are now being deployed in “scale-across” applications, extending distributed training across multi-site GPU clusters. Cloud & Colo revenue grows from about $1.7B in 2025 to $6.1B in 2030, roughly four-fifths of the total market.
Service Provider
With the performance of 400ZR+ 0dBm optics proven and modules widely available from numerous vendors, the limiting factor in router-hosted adoption among Service Providers is operational rather than technical. Two forces further temper IP-over-DWDM growth in carrier networks: the proliferation of dense, low-cost pluggable transponders, and the pace of 400G and 800G router adoption. 800ZR+ optics, which support long-haul operation at 400G, will be especially popular in transponder applications. Service Provider revenue rises from roughly $293M in 2025 to over $1.2B in 2030.
Enterprise & Government
Enterprises and Governments have traditionally favored IP-over-DWDM. With abundant IP expertise but little exposure to optical transport, they see the idea of a WDM interface as just another router-hosted pluggable – transported over a simple line system – appealing. This segment is the smallest in absolute terms, growing from about $62M in 2025 to $266M in 2030, but pluggables will come to represent a meaningful share of these operators’ optical spending.
Six Module Types
The forecast tracks revenue across six categories of coherent pluggable. Module-level detail is the least relevant slice on its own; its value lies in how each generation maps onto the procurement and market dynamics above.
400ZRx -10dBm
OIF-standard 400ZR and OpenZR+ 400ZR+ are combined into a single category, since their deployment scenarios are effectively identical, point-to-point networks under 120km. Today, it’s the most mature and highest-volume category, peaking around 2027 before hyperscalers migrate to higher speeds, declining to roughly $1B by 2030.
400ZR+ 0dBm
400ZR+ 0dBm optics achieve 1000km over real-world ROADM networks, making them suitable for general-purpose use beyond point-to-point Metro DCI. Adoption expands steadily among Service Providers and Enterprises as operational issues are resolved and 400G routers proliferate.
800ZR and ZR+
With 800ZR and 800ZR+ (Gen120C), the performance gap between embedded and pluggable optics shrinks further. OIF-standard 800ZR will see limited adoption; most hyperscalers prefer the higher-performing ZR+ to extend single span AI data center interconnects up to 150km, and regional interconnects up to 1000km with in-line amplifiers. A 400G ULH mode in Open ROADM-based ZR+ lets operators standardize on a single pluggable for 400G or higher across any terrestrial link. Demand is concentrated among Cloud operators, with modest Service Provider uptake as 800G router adoption steadily grows. 800ZR+ revenue ramps from about $100M in 2025 to nearly $1B in 2026.
1600ZRx
600ZRx is likely to be the first generation in which pluggable optics (Gen240C) arrive before the embedded interface (Gen240P) of similar baud rate. With the addressable market for Gen240P shrinking, 1600ZRx may be the point at which Long Haul and Metro networks, whether IP-over-DWDM or pluggable-transponder based, can be built around a single, standardized optical module. Barely within this forecast’s horizon, it nonetheless becomes the single largest module category by 2030.
100ZR
Available in QSFP28 and QSFP-DD form factors, with the lower-power QSFP28 version expected to dominate. 100ZR is predominantly router-attached, with niche transponder use limited to Enterprise DCI access. The report does not distinguish between the two form factors.
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