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June 19, 2002
CHARLOTTESVILLE, Va. -- The DWDM filter market still offers opportunities for those suppliers that know how to stand out from the crowd, according to a new report from Communications Industry Researchers, Inc. (CIR), an optical industry market research firm based here. The new report, The Market for Optical Filters, identifies more than 70 companies that compete in the filter space. However, having interviewed all the leading system vendors about their future requirements, CIR has concluded that filter suppliers can still be successful by using filters as a way to enable lower costs in equipment and networks and by enhancing service provider productivity and by adding value to basic filter products.Filtering Away Costs: The new CIR report claims that success will go to those filter firms that can offer not just the lowest prices for filters, but to those that can market their products as enabling broader cost advantages to both systems houses and carriers. As an example of how filters can be marketed as lowering the total costs for equipment vendors, the report notes that both Hitachi Cable and NEL have been able to distinguish themselves by athermalizing their arrayed waveguide (AWG) products. This means that their customers can lower costs through the elimination of space requirements for heaters and this may help to expand the market for AWGs by making them economically viable in the metro space.Adding Value to Filters: Some basic filters, such as thin film filters (TFFs), are almost commodities. As a result, CIR expects to see some of the more successful filter firms move up the value chain to gain additional revenues and more opportunities for product differentiation from sales of MUX/DEMUX and optical add/drop multiplexer (OADM) modules based on their filter products. Thus both TeraXion and Southampton Photonics have realized the limited potential of the fiber Bragg grating (FBGs) market and so have launched OADM offerings. Communications Industry Researchers Inc. (CIR)
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