Recent activity bolsters nascent free-space optics technology

The free-space optics (FSO) industry received "a major vote of confidence" in September, as numerous deals bolstered the nascent technology's credibility, says a new report from global telecommunications research and consulting firm Strategis Group (Washington, DC). Agreements involving FSO vendors Tera Beam and LightPointe; carriers Qwest Communications, Sweden's Utfors AB, and metro carrier Telseon; and equipment vendors Cisco Systems, Corning, and Texas Instruments signify "a giant leap" for FSO technologies, claim analysts.

"The recent deals in the FSO industry clearly show that the FSO industry has awoken from its relative lull since the April 2000 announcements of the Air Fiber-Nortel and TeraBeam-Lucent alliances," contends Peter Jarich, director of broadband research.

Despite the economic downturn, the FSO market is expected to jump from its $120-million mark in 2000 to more than $2 billion by 2006, for a compound annual growth rate of 61%. While vendors still need to address the limits of the technology, including short link distances, weather-related problems, and the need for automatic tracking, the technology's reputation is evolving from a primarily enterprise-based solution to one of more mainstream acceptance.

"Technological and market innovations are empowering best-positioned FSO vendors to differentiate themselves as focus shifts to carrier customers, bandwidth capabilities continue to expand, and vendors tackle the challenge of clearly demonstrating the distance and fog limitations of their products to prospective customers," asserts broadband analyst Randall Haley.

The report, "Free-Space Optics: Global Trends, Positioning, and Forecasts," features market projections through 2006, segmented by application, bandwidth, and geography, as well as detailed profiles of the major FSO vendors. Competitive pricing analysis and recommendations for FSO vendors are also included. For more information or to order a copy of the report, contact the Strategis Group at 202-530-7500 or visit the company's Website at

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