OMM Gets a Breather
The company says its optical switching subsystems have passed the demanding environmental and reliability tests outlined in the Telcordia Technologies Inc. specifications (see OMM Passes Telcordia Standard). These tests are designed to show that gear can be stored, transported, and deployed in less than perfect environmental conditions, without any degradation in performance.
It's an important milestone for OMM, of course, and a vital part of the product development process. "Our customers are telling us that their customers will not buy products from them unless they are fully Telcordia compliant," says Conrad Burke, OMM's VP of sales and marketing.
But the significance of the announcement goes deeper. As the first company to gain Telcordia qualification for micro-electro-mechanical system (MEMS) switches -- those based on arrays of tiny tilting mirrors -- OMM is giving a boost to all the players in that sector of the industry.
Despite the fact that MEMS is widely used in other industries, telecom observers have remained skeptical that it would have the carrier-class reliability needed for optical networks. MEMS contains moving parts, which could jam, wear out, or become damaged in earthquakes, making them intrinsically unreliable, they say.
As the biggest supplier of MEMS-based switches, OMM has borne the brunt of rumors that the tiny mirrors stick and fail in the field. For the record, Light Reading has not been able to substantiate those rumors in the past. With its announcement today, OMM hopes to "finally put to bed any question or doubt about the reliability of MEMS in optical switching."
OMM claims that its 2D switch arrays -- the switch that it's shipping to the majority of its customers -- have passed Telcordia GR-1073-CORE, which gives specifications for optical switches; GR-1221-CORE, which concerns passive components; and GR-468-CORE, which covers active components such as lasers and detectors.
In fact, OMM contends that in some cases it's actually exceeded the requirements. "We've got devices that we've switched 19 million times without failure," Burke says. "To put that into context, 10 million cycles at a rate of one on/off per minute would take 20 years."
Here's another statistic: Each individual mirror in one of OMM's switch arrays has a so-called FIT rate (the number of failures in a billion hours of operation) of 60, and an entire 8x8 module has a FIT rate of about 600, says Burke. For comparison, a connector has a FIT rate of about 200 and a pump laser about 1000.
The reliability qualification is timely too. "Last year, customers didn't ask too many questions about reliability, because components were in such short supply," John Midgely, CEO of Lightwave Microsystems Corp. told Light Reading last week. This year there's a lot more choice, and reliability is at the forefront again, he says. That comment rings as true for the crowded MEMS-based components market as it does for AWGs (arrayed waveguide gratings -- Lightwave's main product).
On the minus side of things, only the 2D switch subsystems are fully qualified. These contain mirrors that flap around in one direction only, and are best suited for making small switches. The 3D MEMS that OMM is working on for its larger switches will take more time to test. That's partly because they were developed later, and partly because they are build into a system-level replacement box that has to pass NEBS specifications in addition to Telcordia, says Burke.
Trouble is, even this dose of good news may not be enough to keep the company afloat. OMM says it has shipped switches to 28 paying customers, and has reached field trial stage with three of these. Now, the company has to keep its fingers crossed in the hope that its customers will manage to sell a decent number of optical switches (see Components, Anyone?). Only then will revenues start to ramp significantly. The sales cycle can take up to a couple of years, which is a long time to keep a company in a holding pattern.
It's hard to tell whether OMM will endure. Burke says that the company has enough cash to last until the end of the year. He also noted that it had received further, unpublicized investment from "strategic partners," public companies that don't want their names bandied about. It wasn't clear if the investment came from new partners, or from the existing ones, which include Alcatel SA (NYSE: ALA; Paris: CGEP:PA) and Siemens AG (NYSE: SI; Frankfurt: SIE). (In other words, did the existing investors step in to prevent disaster?)
Burke also noted that OMM had cut its burn rate significantly by laying off another 70 of its staff about a week ago. That brings the total head count at the company to about 320, and total job cuts to 150.
— Pauline Rigby, Senior Editor, Light Reading