Quantum key distribution (QKD) allows two parties to produce a shared random secret key known only to them, which can then be used, for example, to encrypt and decrypt messages. It relies on the principles of quantum mechanics to guarantee security. The quantum property of eavesdropping detection makes QKD theoretically secure against hacking by quantum computers. It provides confidentiality in fiber networks and encryption keys for various applications ranging from defense, healthcare, government, and finance.
The market is witnessing increased investments from both private and government organizations as QKD networks can ensure protected data transmission and help thwart cybercrimes, which have significantly risen over the past few years. However, high setup costs and technological challenges are impeding widespread deployment of QKD networks. Nevertheless, as research continues to make progress, QKD network infrastructure is expected to grow substantially in the coming years.
The global Quantum Key Distribution Market is estimated to be valued at US$ 2.07 Billion in 2023 and is expected to exhibit a CAGR of 12% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
The major trend in the market is the increased research and development to expand the reach of QKD networks. Currently, QKD networks can operate over limited distances of only a few hundred kilometers due to photon loss over fiber. However, researchers are working on repeater technologies that can distribute entangled quantum states over long distances, thereby allowing nationwide or even global QKD networks. National programs such as China’s ‘Quantum Science Satellite’ that launched the world’s first quantum science satellite in 2016 are aiding such technological advancements. Other trends include the integration of QKD with existing telecom infrastructure and development of user-friendly QKD solutions for commercial applications.
Threat of new entrants: The quantum key distribution market poses moderate threat of new entrants as it requires a lot of time and investment in R&D for developing new technology.
Bargaining power of buyers: The bargaining power of buyers is low as the quantum key distribution systems provide high level security solutions that are difficult to substitute.
Bargaining power of suppliers: A few major players operate in the quantum key distribution market, giving them significant bargaining power over buyers.
Threat of new substitutes: There is low threat of substitutes as quantum key distribution offers the highest level of security that is difficult to achieve through alternatives.
Competitive rivalry: The competitive rivalry in the quantum key distribution market is high due to the presence of global technology giants focusing on this emerging technology.
The Global Quantum Key Distribution Market Size is expected to witness high growth.
Regional analysis: The North America region is projected to dominate the global quantum key distribution market during the forecast period. This is attributed to significant investments by government organizations and technology companies in the region towards the development of quantum technology.
Key players: Key players operating in the quantum key distribution market are Pfizer, Inc., Bristol Myeers Squibb Company. These players are focusing on new product launches and partnerships with technology companies for business expansion.
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it