In mid-October, the PHOTONICS GERMANY Future Summit focused on the key growth markets and the basic conditions affecting the photonics sector in Germany. The outlook is good, but global competition is increasing.
With 176,000 employees and a turnover of €47 billion, the 1,000 or more companies in the German photonics sector are driving forward futuristic technologies for key markets. They supply the key components for non-invasive or minimally invasive diagnostics and for efficient therapies in the healthcare sector. They offer scientists insights into microcosms and nanocosms on a cellular level, minute observations and analyses of weather phenomena, and even a glimpse into distant galaxies. With imaging and optical measurement systems, as well as high-precision laser processing solutions, they provide industrial users with the supporting pillars for all-round quality-monitored and connected production. Photonics is also seen as an enabler and driver of progress in mobility, defense, the food sector and the energy industry, and of course in information and communications technology.
Thanks to its broad focus and its great importance for so many different applications, the sector in growing throughout Europe and the world. In Europe for example, 390,000 people already work in the sector—a sector which recently generated a turnover of €100 billion. With a 40 percent share of the market, Germany is ahead of France and the United Kingdom with 15 percent each, the Netherlands (6%), Italy (5%) and Switzerland (4%). And as Dr. Bernhard Ohnesorge, Managing Director of Carl Zeiss Jena GmbH and Chairman of the SPECTARIS Photonics Association, noted at the PHOTONICS GERMANY Future Summit in Berlin in the middle of October, the sector remains on course for growth in spite of the pandemic, strained supply chains and escalating geopolitical conflicts. “The coronavirus effect of 2020 is long gone. We came out of 2021 with 18 percent growth and the outlook remains good,” said Ohnesorge in Berlin. According to Ohnesorge, the market research carried out by SPECTARIS and TEMATYS predicts average annual growth rates of 6.5 percent until 2025. However, the chairman of the association is concerned about increasing global competition.
Ohnesorge is concerned that the global market share of European suppliers has fallen by three percent in the last 15 years. He stated that Germany’s market share had fallen by 1.5 percent, while China had increased its share from ten to just under 30 percent. The USA’s market share had also increased. Unfortunately, the German and European sector had been growing more slowly than the global market for a number of years now. “Our aim must therefore be to defend and increase our world market share in relation to China and the USA,” he emphasized. PHOTONICS GERMANY has therefore set out a number of proposals and demands to politicians in a position paper. It calls for more support for small and medium-sized companies, a reduction of bureaucratic and tax burdens, expansion of the digital infrastructure, and more targeted research funding. After all, this is a key technology with a direct influence on over a tenth of total European economic output. The wide range of applications demonstrates the enabler role of photonics. “With its high-tech products, it ensures the technological sovereignty of the European economy,” he said.
Many nations have recognized this leverage effect and are therefore channeling large sums into photonics funding. China has increased its funding amount from the equivalent of €140 million to €1.1 billion. In Korea, photonics funding amounts to €2.84 billion, and the USA and the Netherlands also provide billions for research. In each case, research in the field of integrated photonics is a priority. According to Ohnesorge, what will happen next with photonics funding in Germany is uncertain. He stated that the evaluation of the funding measures from 2012 to 2020 had shown that every euro invested generates many times more in the user industry. This would mean that continuing funding should actually be self-evident. However, redirecting the funds from photonics to quantum technologies was being considered. “Photonics has by no means been fully explored,” he said. As he pointed out, it still offered immense, previously untapped innovation potential. And there was much work to be done, especially in the area of new optical materials, such as those for nonlinear optics and applications across the entire wavelength spectrum from ultraviolet to infrared. After all, this would lead to more efficient and compact systems and provide a basis for microintegrated optical systems and innovative radiation sources. Radiation sources which can be used universally and flexibly are considered a field of innovation that promises new approaches for materials research, medical technology and basic physics research. And the miniaturization and microintegration of photonic systems still offer plenty of scope for innovation and hence market potential that ought to be leveraged. Among other things, the position paper proposes a photonics research factory that would provide small and medium-sized companies with access to capital and knowledge-intensive infrastructures and processes.
This targeted photonics funding will provide leverage in future fields which are highly relevant for society. These include more sustainable and flexible production, efficient health care for aging populations, low-emission and safer mobility, climate and environmental protection and, last but not least, national security, which is now being seen in a new light given the current global conflicts. The position paper urges that funding be focused on missions in these future fields instead of concentrating one-sidedly on quantum research, although it is undoubtedly very important. For the next five years, it therefore proposes a mission-oriented research program with a budget of €800 million in addition to funding for quantum technologies. “We need end-to-end research and development (R&D) funding for photonics—from basic research to pre-competitive and competitive research and development,” said Ohnesorge in his keynote address at the Future Summit.