Teem Photonics buys the assets of its competitor Northstar Photonics. How are other EDWA startups doing?

August 5, 2002

4 Min Read
Shakeout in the Amp Camp

It looks as if a shakeout has started among startups developing erbium-doped waveguide amplifiers (EDWAs) -- the integrated equivalent of Erbium Doped-Fiber Amplifiers (EDFAs).

Today, French startup Teem Photonics announced that it has bought the intellectual property of its former competitor Northstar Photonics Inc. for an undisclosed amount of cash. Northstar is still operational "for tax reasons," says James MacKenzie, VP of business development and marketing for Teem Photonics, but will wind down its activity soon.

Teem's engineers have just completed a two-month stint at Northstar's facility in Maple Grove, Minn., learning about the company's manufacturing processes and patents, so they could be transferred to Teem's site in Grenoble, France. Teem is not planning to transfer any of Northstar's employees.

Teem is undeniably pleased about its purchase. "It gives us a much stronger [patent] base to defend what we're doing," MacKenzie chirps. "And it will speed up our development process quite considerably." He claims that Teem is at a "very advanced stage of some design wins" and hopes to announce a customer soon.

But while Teem's star is rising, Northstar's is falling. And Northstar's imminent demise raises questions about the fate of other startups developing EDWA technology, including Cisilias, Inplane Photonics Inc., Molecular OptoElectronics Corp. (MOEC), Redfern Integrated Optics, and Symmorphix Inc. Overall, the news isn't good.

MOEC, for instance, has decided to focus on other markets outside of telecom, Mike Shimazu, its VP of business development told Light Reading today. Having announced its EDWA gain block in March this year (see MOEC Intros EDWA and VOA), the startup has since cut staff from over 100 to under 30, he says.

Furthermore, a key executive at MOEC -- CTO Dr. Brian Lawrence -- is reported to have quit the company in the past few weeks. Dr. Lawrence joined MOEC in 1996 and rose through the ranks from engineer, to project leader, to his most recent post as VP of research and engineering and chief technical officer. Shimazu declined to comment on the truth of this rumor, although he did say that the startup was preparing a statement about personnel changes.

Then there's Symmorphix, which has cut roughly fifty percent of its workforce this year and closed down one of its centers in Santa Rosa, Calif., according to Bob Conner, its chief marketing and strategy officer. The remaining 25 employees have been consolidated at Symmorphix's Sunnyvale facility.

Symmorphix hasn't announced any products yet, and given the current state of the market, it "doesn't wish to speculate" on when it might actually announce them. Its original plans called for the company to release products earlier this year, which clearly didn't happen (see Symmorphix Joins the Amp Camp).

The fact that it's over a year since Symmorphix won its last round of funding also raises doubts about its future. Conner declined to comment on the question of funding, but insists that the company is doing whatever it can to weather the downturn. "We're working with key customers," he says, noting somewhat ambiguously that it's the quality of Symmorphix's customers that matters.

On a slightly more positive note, Danish startup Cisilias moved to secure its future by merging with Ionas A/S, an optical foundry under the same ownership, to form a new, streamlined company called NKT Integration A/S. The new company has 70 employees and has consolidated its operations at Birkerød, which is north of Copenhagen.

The move made sense because Ionas specialized in PECVD (plasma-enhanced chemical vapor deposition) -- the same fabrication process that Cisilias used to make its EDWAs. Cisilias had released a 12-port amplifier earlier this year (see Cisilias Demos Amplifier).

That leaves InPlane Photonics which, along with Teem, appears to be carrying the EDWA torch high. InPlane scored $20 million in March 2002 and released its first product -- a tunable dispersion compensator -- soon after (see Inplane's in the Money and Inplane Intros Amplified TDC). Where InPlane differs from Teem is that it's targeting a range of highly integrated amplified components from the outset, not just an EDFA replacement.

Australian startup Redfern reportedly is still in the very early stages of product development and could not be reached for this article.

— Pauline Rigby, Senior Editor, Light Reading

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