MEMS suppliers still take beating from optical networking

July 1, 2005

Although the level of unit shipments remained essentially “flat,” revenues for micro-electromechanical systems (MEMS)-based devices sold into the optical-networking market declined by 27.2% from 2003 to ’04, according to a report by EmTech Research (Ann Arbor, MI).

Once considered the “golden child of telecommunications,” suppliers developing MEMS-based components for optical-networking applications continue to be overwhelmed by poor market conditions., says the report.

“Even a new strategy, in which many MEMS suppliers are now offering intelligent modules such as wavelength-selective switches, rather than just components, may not be enough,” contends EmTech research vice president Marlene Bourne. “2005 will be a pivotal year where survival will be the main business focus.”

The report notes that, despite current market conditions, MEMS suppliers pursuing the optical segment received $63.5 million in funding over the past 12 months. However, this year’s forecast is just 1/10th of what was forecast for late 2000 and half of what was forecast for last year.

The report predicts funding of slightly more than $150 million by 2009, with unit shipments projected to increase at a 9.4% compound annual growth rate over the next five years.

For more information on the report, “MEMS Market Brief: Last Call for Optical Networking?”, visit the research firm’s Website, www.emtechresearch.com.

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