Optical components

Optical vs China

8:30 AM -- Thanks to the sources who tipped us off on the Xponent Photonics Inc. plight. (See Is Xponent Xpiring?.) One of them brought up an interesting point: Maybe Xponent, whose specialty was an automated manufacturing process for optical components, got done in by China's labor pool.

The theory goes that China's labor costs are so low, and the laborers so good at their jobs, that a manual assembly process still outdoes an automated one, despite the apparent cost advantages of passive alignment. In other words, human hands aren't that much more expensive than the machines, and they do a good enough job.

Well, acting CEO Jay Abbe says that is not what happened to Xponent. So much for my long-winded explanation.

But he does agree on the macro trend, that the availability and quality of labor is quelling the cry for automation. (Yes, I'm saying it that way just to get "quelling" in a sentence.)

Like a lot of people, I believed in 2000 that optics manufacturing was going to follow the footsteps of the semiconductor industry, creating automated processes that would eventually standardize. It's heading that direction, but very slowly. China's labor pool is one factor, but more importantly, the mass mass market that would spur the transition just hasn't arisen yet.

— Craig Matsumoto, West Coast Editor, Light Reading

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