Visible Light Communication (VLC) - A Potential Solution to the Global Wireless Spectrum Shortage

Additional Information

GBI Research’s new report, “Visible Light Communication (VLC) - A Potential Solution to the Global Wireless Spectrum Shortage”, provides the key information and analysis on Visible Light Communication technology and market. Visible Light Communication or VLC is a method by which Light Emitting Diodes (LEDs) are used to transmit data using visible light as a transmitting medium.

The report covers the latest information and research efforts of various companies and institutes on VLC across the world. The report provides market size for different component types used in VLC and also provides analysis on the key VLC end user market segments. The report also provides comparative case studies between VLC, Infrared and RF communications. It also gives an in-depth analysis of Visible Light Communication becoming a potential solution to the global wireless spectrum shortage.

This report is built using data and information sourced from proprietary databases, primary and secondary research and in-house analysis by GBI Research’s team of industry experts

Last mile connectivity

Visible Light Communication has the potential for being an economical, secured solution to the last mile connectivity problem. LEDs in the bulbs apart from providing lighting can also be used for wireless communication and this can significantly improve security and capacity over fiber optic communication. The LED link is untethered and hence enables a communication link with many mobile devices like laptops and mobile phones. The link is untethered in the sense that a user is independent of any one host, and can get the same information at other optical hosts. Power Line Communications and Indoor Communications are two significant applications where the connectivity between the gadgets and the data providers cause bottleneck issues. VLC can thus play an important role along with other wireless technologies like Wi-Fi to address this problem.

Reduced Power Consumption and Energy Savings

The Global Lamp Market consisting of both CFLs and LEDs is expected to reach $24 billion by 2015 riding on the rapid decline and phasing out of incandescent bulbs in many countries like EU, Australia, Taiwan and China. These initiatives were due to the energy savings and the green factor of the LEDs over the halogen lamps. The US Department of Energy (DoE) estimates that a faster adoption rate of LED lighting in the US over the next 20 years can:

Deliver Energy savings of about $265 billion.

Avoid 40 new power plants.

Reduce the demand for lighting electricity by 33% in 2027.

The inflection point for LED lights is around $10 and at this price point the payback will be in one year resulting in tremendous growth in the home lighting market. This positive market trend of adopting LEDs for lighting across the world is going to drive VLC-based devices adoption in future.

Growing LED market to aid VLC technology

The market revenues for the global LED market are shown in the table below. 2010 can be said as the banner year for LEDs as they saw a phenomenal 30% growth in revenue over 2009 with total revenues standing at $9.1 billion. This growth can be attributed to the increased sales of smart phones, LED televisions, HDTVs, tablet PCs and other media based gadgets. The global LED market is expected to touch $14.2 billion in revenues in 2015.

Global LED Market, Sales Revenue, ($bn), 2005-2015

Source: GBI Research

This growth in the LED industry can bring down the prices of LEDs to more reasonable levels and also increase their efficiency due to increased R&D efforts from the industry. This development can thus be very useful for the deployment or acceptance of VLC based devices in the general public more easily.

Higher costs for VLC based devices

According to Dr. Hanny Elgala, Electrical Engineering Department, Jacobs University, Bremen, the cost of the first Visible Light Communication Based devices will be starting from the lower range of $500. The average LED lighting lamp costs $30 according to him and this will be the biggest market restraint VLC needs to face before it even enters the commercial market. Though there are immense cost savings of up to 80% on electricity bills, the psychological barrier of spending big money on a newly introduced technology can take years. So researchers need to use better and cheaper materials to significantly reduce the costs.

Increasing Data Rates

Data rates using Visible Light Communication can reach 100 Mbps using the high speed white LEDs. But to compete or compliment in a market crowded with many wireless and wired communication technologies, VLC needs to differentiate itself primarily on the basis of high download speeds. This is a challenge that has to be dealt with technically as the switching rates at which LED can be operated without heating or damaging it is crucial. One method is to use parallel communication in which a cluster of LEDs send different data to a receiver which can then separate the information from each stream. This method was successfully tested using 300 to 500 LED arrays reaching speeds of up to 1 Gbps.

Government initiatives to implement efficient lighting standards

The push for the replacement of incandescent lamps with CFLs and LEDs by governments across the world is definitely going to be a significant driver for the VLC technology market. This replacement as shown in the table below is faster in the European Union region compared to other geographical regions. Although the initial costs of LEDs and CFLs are higher than Incandescent lamps, creating awareness among consumers, providing government subsidies and reduction of market rates due to increased production will go a long way in ensuring that LEDs will soon be found in many places.

Global Region Government Initiatives for Banning Incandescent Bulbs, by Region

Source: GBI Research