Fiber-optic cable suppliers expand production capacity
Ben Harrison
To meet surging market needs for fiber-optic cable products, Alcatel Telecommunications Cable, Claremont, NC, is plowing in another $50 million on top of an earlier $100 million investment in an optical-fiber and fiber-cable plant expansion. In a related fiber- and cable-manufacturing expansion development, AT&T Network Systems, Morristown, NJ, says it has reached the half-way mark in its plan to achieve a fivefold increase in worldwide production capability.
For Alcatel, this additional cash infusion means that the fiber capacity of the Claremont complex will increase by 35% by the beginning of 1997, according to C.J. Phillips, president of Alcatel Telecommunications Cable. He notes that 15% of the plant`s output is exported to Mexico, China and South America.
AT&T Network Systems` Luther Boggs, product management director for the optical-fiber and cable business unit, says, "We attribute our expansion rate to growth experienced by our customers worldwide. Many domestic and international markets that were beginning to take shape only a few years ago are now enjoying unprecedented growth. AT&T is expanding its global manufacturing operations in all of its regions by investing more than $300 million over the next few years."
This expansion of fiber-optic cable operations by Alcatel and AT&T is right in step with other major industry players. Corning recently announced that it is increasing capacity of its optical-fiber manufacturing facility in Wilmington, NC, and investing more than $150 million in the facility. Corning says it plans to increase its fiber-making capability by more than 50% during the next two years.
Additionally, Litespec, Research Triangle Park, NC, expects to nearly double its current manufacturing capacity by the end of 1996, to produce close to 1 million kilometers of fiber-optic cable per year.
Phillips of Alcatel explains how his company`s expansion involves changes in its proprietary process of singlemode fiber-cable manufacture: "We are upgrading our equipment and making internal changes in our proprietary technology that make our facility more efficient."
Unrelated to Alcatel`s plant expansion, Phillips says his company has raised prices of its fiber-optic cable 6% to 10% to meet increasing demand. This increase is in line with Siecor`s 12% hike in April (see Lightwave, July 1995, page 1).
Phillips further explains that the plant`s cable operations are self-sufficient for fiber, and this has helped the company absorb price increases in the past. "In some cases, we were even able to reduce prices to our customers. This is no longer possible. In spite of the growth in market volume, increased costs for raw materials and transportation have made it necessary to increase prices for the first time.
"After the sale of our copper telephone-cable business, we are going to aggressively pursue expansion plans and focus resources on expanding our fiber-cable business," Phillips notes. He says the fiber-cable market grew 15% to 25% per year over the past several years. "All indicators suggest this trend is continuing," Phillips says, "and in the past few months, we have seen an even more dramatic increase in demand for products from all of our customers--including telephone companies, cable-TV system operators, as well as alternative access providers of telecommunications services."
An industry analyst, Stephen Montgomery, vice president and chief operating officer of Electronicast Corp., San Mateo, CA, sees telecommunications as the dominant application for North American fiber-optic cable consumption, followed by premises data networks and cable-TV.
By 2004, telecommunications will still dominate fiber-optic cable use, with more than 60% share of a forecasted $5 billion total consumption cable market. "The forecasted plateau in cable-TV fiber-optic cable new installation, 1998 to 2003, is due to the increasing absorption of cable-TV into telephone systems, using the telephone network partially or totally for distribution," Montgomery says.
Burgeoning fiber-cable expansion is also reported by AT&T. In North America, the company is increasing its fiber and cable manufacturing capability at its Norcross, GA, plant. In the Asia-Pacific region, AT&T has established two joint ventures in the People`s Republic of China: AT&T of Shanghai Fiber Optic Co., which will manufacture optical fiber beginning late in 1995, and AT&T of Beijing Fiber Optic Cable, which began production late last year. Other fiber-optic cable ventures in the region include AT&T Yazaki in Numazu, Japan, and a new company, AT&T Finolex Fiber Optic Cable in Pune, India, which will begin production in early 1996.
AT&T is also active in Europe. Lycom, a wholly owned facility near Copenhagen, is expanding its fiber-manufacturing capability to support cabling operations. A manufacturing facility in Augsburg, Germany, will begin production by year`s end.
As a recent example of growth for AT&T`s fiber-optic products, Truewave fiber was developed initially for use in cable installations for AT&T worldwide networks (see Lightwave, December 1994, page 1). Now it is being used for fiber-optic networks for evolving gigabit opto-electronic technologies, especially dense wavelength-division multiplexing systems.
In Alcatel`s Claremont plant expansion, the $50 million will be used to boost the operation`s capacity for both existing and new fiber-optic cable products. The company will also install proprietary technology, development of which was recently completed at Alcatel Cable`s optical-fiber manufacturing facility in Douvrin, France.
A fiber plant located adjacent to Alcatel Telecommunications Cable began shipping fiber in the third quarter of 1993. Since then, all of the fiber made at the Claremont facility has been used exclusively by the adjacent cable plant to manufacture increasing amounts of fiber-optic cable. Additional fiber requirements are supplied by Alcatel Telecommunications Cable`s second optical-fiber plant, located in Roanoke, VA.
The expanded complex in Claremont is located on 74 acres, occupies nearly 360,000 square feet and employs more than 600 workers. Chief Executive Phillips explains that the complex incorporates a "cellular" manufacturing concept, in which work is performed in cells or business units by teams of workers. The entire fiber production facility is a cleanroom environment that all employees must enter through air-lock rooms.
There, employees put on dust-free jump suits and boots before entering the fiber production area. This area has a sophisticated air-filtration system that filters and changes all of the air in the fiber plant every three minutes. Phillips says air in the cleanroom is six times cleaner than the air in an average office building. q