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    MEMS continues advance into optical networking

    April 22, 2003
    22 April 2003 Scottsdale, Ariz. Lightwave Europe-- Last year, 2002, proved "surprisingly strong" for suppliers of MEMS-based solutions to the optical networking market, reports In-Stat/MDR (www.instat.com).

    22 April 2003 Scottsdale, Ariz.-- Last year, 2002, proved "surprisingly strong" for suppliers of MEMS-based solutions to the optical networking market, reports In-Stat/MDR (www.instat.com).

    The market research firm attributes much of this to the fact that many of these devices have now passed Telcordia standards, giving them real respectability within the market. As a result, a number of companies saw their shipments move beyond sampling and into volume production in 2002.

    The long-term prospects for the communications market remain "very strong", says InStat. As a result, although the market for MEMS in optical networking may be down from previous forecasts, it is by no means out, with revenues seeing a CAGR of 41.8% through 2007.

    "While device reliability is no longer the issue, company stability is. Fully 50% of the companies known to be developing MEMS solutions for optical networking have closed their doors, and the question lingers as to who will be next," says Marlene Bourne, a Senior Analyst with In-Stat/MDR.

    Even so, those remaining in the market were still able to raise more than USD55m in venture capital funding throughout 2002. According to Bourne, "Other trends in this market include a noticeable change in the types of devices that have gone into volume production - more companies are now offering variable optical attenuators and tunable filters, and there has been a discernable shift to small and 3D switches. The increased presence from Asia-Pacific companies cannot be ignored."

    In-Stat/MDR has also found that:
    - In 2002, there was strong movement of 3D switches into the market. Since these switches have a very high price point, their sales generated significant levels of revenue.
    - MEMS suppliers can expect a strong increase in customer demand and design wins in the 2004/2005 timeframe. This will translate into real revenue growth in 2006 and 2007. Up until then, the market is slowly moving forward with increased sampling and unit shipments to a greater number of customers.

    The report MEMS and Optical Networks: Down But Not Out (#IN030600EA), provides an overview of the dramatic changes that have taken place within the optical networking segment as it pertains to MEMS suppliers, including who's gone, who's left, and, even more remarkable, who's new.

    It reviews the good and bad of 2002, and what to expect going forward, and also presents an overview of current product offerings and availability. Forecasts of revenues and unit shipments for switches and other components are provided through 2007.

    To purchase this report, or for more information, please visit: http://www.instat.com/catalog/cat-esa.htm or contact Rick Vogelei at 480.609.4533; [email protected]. The report price is USD2,995.

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