State of the copper market: Shielded grows, but UTP dominates

Coaxial cable will slide downward because of video’s migration to IP.

By Frank Murawski, FTM Consulting

In our recent analysis of copper cables used in structured cabling systems (SCS), copper cable of all constructions, taken as a group, is projected to grow from $4 billion in 2011 to more than $10 billion in 2016. Copper cables include unshielded twisted-pair (UTP), shielded twisted-pair (STP) and coaxial cables. UTP cables are the most popular for the United States SCS market. Currently Category 6 and Category 6A UTP cables are being used in most new installations. Both STP and coaxial cables have limited use in the U.S. SCS market presently.

Currently UTP accounts for 92.5 percent of the total U.S. copper cable market, with STP accounting for 2.2 percent and coaxial accounting for 1.6 percent. UTP cable growth is driven by the need to replace early-generation Category 5 cables with higher-performance UTP cables, in conjunction with their use in new high-growth markets of data centers and Voice over Internet Protocol (VoIP). Although all of the current marketing hype is for fiber cabling in data centers, there is a large base of smaller data centers, in which high-performance UTP cables provide adequate performance.

STP to have highest growth

STP cables are forecast to have the highest growth rate, at 26.4 percent per year over the next five years. This growth is driven by the anticipated standardization of shielded Category 7 and Category 7A cables in the near future. In addition, shielded Category 6 and Category 6A STP cables are expected to be deployed in certain situations, in which shielding the cables is necessary. STP cables are viewed as a niche market product for use in sites needing higher performance than provided by the highest-performance UTP cables and the firm being small enough that it would be too costly to upgrade to fiber cables.

Coaxial’s decline

Currently coaxial cables are used in two primary applications: security video-camera networks and DS carrier interface to data centers. The larger of these two applications for coaxial cables, the camera networking, is rapidly shifting to UTP cables capable of supporting the Internet Protocol-based video signals. The use of UTP cables in this application has the added benefit of being able to integrate the camera network into the enterprise’s core network. This decline in use of coaxial cable will not be compensated for by the DS carrier application. Although data center cabling is a growth market, the small number of these cables per data center site, in conjunction with the limited distances, makes this a limited market for coaxial cables. Because the camera network application accounts for the bulk of coaxial cables used in SCS deployments, the coaxial cable market is expected to decline over the next five years.

Discussions have begun about twisted-pair cables supporting future high speeds of 40 and 100 Gbits/sec over limited distances. Current approaches include multiple cables, each supporting either 10 or 25 Gbits/sec, being aggregated to support these high speeds. Current technology indicates this may be a viable approach for 40 Gbits/sec, but not for 100 Gbits/sec. New technology approaches will be required to support 100 Gbits/sec.

Frank Murawski is president of FTM Consulting (www.ftmconsulting.com).