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Paxera Packs Tunable Lasers

Craig Matsumoto
1/30/2006

Yet another tunable laser company is emerging, but this one -- born after the optical market crashed -- thinks it can stand out with a new technology that promises better performance.

Paxera believes it's the only components play to be funded in 2002, the height (or nadir) of the optical drought. Paxera's sandbox is the tunable filter, a relatively obscure type of component that got big press during the bubble.

But the trend in photonics has been for companies to move up the food chain, realizing that piece-parts by themselves haven't been a profitable business -- so Paxera is shipping a tunable laser, packing its filter in with a continuous wavelength laser diode. The goal is to provide better performance than DFBs at possibly a little more cost at first.

The 20-employee startup has begun sampling products and is starting the process of Telcordia qualification. General availability should come later this year, CEO Ben Sitler says.

Tunable lasers were a hot sector during the telecom bubble of 1999, when startups like Agility Communications Inc. and Iolon Inc. were flying high. The idea was to replace dozens of different lasers with one model that could provide multiple wavelengths.

The devices first caught on as a way to simplify inventory for carriers and DWDM vendors. More recently, tunable lasers have been seen as a way to remotely change the wavelength of a port, Sitler says.

The first wave of tunable laser companies is ending with mixed results. Agility came out a survivor, having been acquired by JDSU (Nasdaq: JDSU; Toronto: JDU) late last year. Iolon was less fortunate, getting its assets bought out by Coherent Inc. (Nasdaq: COHR) Other startups still kicking include Santur Corp. and Syntune AB . (See JDSU Tunes In Agility and Iolon Sells for $5M.)

Despite the number of names out there, the market might be able to absorb one more, as tunable lasers become more widespread and less expensive. "The world has not found the ultimate tunable laser, I think -- although it seems like the tunable lasers that are out there are working well," says Tom Hausken, analyst with Strategies Unlimited .

Paxera shares one aspect with bubble-era startups, in that it began as a science project. Founder Raymond Chu worked with acoustic optics -- a technology that's been around for a couple of decades -- while at KLA-Tencor Corp. , a longtime vendor of manufacturing equipment for the semiconductor industry. He left KLA for a short stint at Iolon before starting Paxera, hoping to apply acoustic optics to telecom.

Acoustic optics uses radio frequency (RF) waves to excite a crystal, changing its index of refraction. The crystal can then be used as a tunable filter, with the affected wavelengths changing as the RF frequency changes. The technology has shown up elsewhere in telecom in mux/demux devices.

Paxera doesn't sell a full laser module, but just the integrated tunable laser array, which includes an inexpensive laser and Paxera's tunable filter, but leaves out the electronics.

Given its post-bubble roots, the company has run lean, getting by on $5 million since its inception in 2002. That includes money from an angel investor and a 2004 venture round that included Crescendo Ventures , Harbinger Venture Management , Infinity Capital , and one component company that Sitler won't name.

"Look at the other tunable laser companies out there. They all raised $100 million or $200 million," Sitler says. "Of course, that was during the heyday."

— Craig Matsumoto, Senior Editor, Light Reading

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whyiswhy
whyiswhy
12/5/2012 | 4:07:48 AM
re: Paxera Packs Tunable Lasers
This has got to be either the single best story of a start-up ever (how to survive four years on $5M), or the start of another round of funding, having finally gotten their prototype working (after four years of development...)

Knowing at least one of the VCs behind them, my vote is on the latter...

But I beg to be corrected, and look forward to seeing their new product announcement on their still incomplete web page, along with its Telcordia qualification report...

Right.

-Why
o-man
o-man
12/5/2012 | 4:07:46 AM
re: Paxera Packs Tunable Lasers
I remember seeing Drew and Stiller at a "heavy reading/drinking" event is Half moon bay...

They were quite confident in the return of the DWDM market... this just before the FTTH speil by Mr. Lanza the following day...

My question is: If you sell a sub component to a dull market...how do you make big money? Follow on to that can this technology fit into an XFP???
Pete Baldwin
Pete Baldwin
12/5/2012 | 4:07:45 AM
re: Paxera Packs Tunable Lasers
Why: I believe you're correct. Paxera is looking for its next round. To be fair, we contacted them for this story; they didn't come to us trolling for publicity.

O-man says: My question is: If you sell a sub component to a dull market...how do you make big money?

Not that I have an answer, but I'll add: isn't that the question for the whole optical components sector in general? Even as the recovery comes around, who's really going to make money here?
paolo.franzoi
paolo.franzoi
12/5/2012 | 4:07:44 AM
re: Paxera Packs Tunable Lasers

Craig,

There is this FTTP (FTTH) market that you have plenty of articles on. Ever wonder why no big players are making components for that business? JDSU still think that Verizon is not going to be deploying PON?

seven
Vent
Vent
12/5/2012 | 4:07:41 AM
re: Paxera Packs Tunable Lasers
Paxera's external cavities approach may have some advantages at the moment, ? but as previously mentioned lets see the Telcordia qualification, external cavity means lots of lenses and complicated package assembly which means stability problems. It also means cost.
Lightreading what about the other external cavity people Intel and Pirelli how are they doing with regards Qualification, I presume as Intel have the fujitsu deal that laser is qualified.Pirelli ?
Syntune any update ? and what about Bookham integrating (with external lenses in the package)
with the MZ modulator.
lightreading as you approached Paxera how about approaching the other lesser known suppliers
besides Santur and JDSU (agility)
By the way lets look at the component supplier involved which one of the big players is missing, and where are paxera based Hmm


Venting my
o-man
o-man
12/5/2012 | 4:07:38 AM
re: Paxera Packs Tunable Lasers
Craig,
"Not that I have an answer, but I'll add: isn't that the question for the whole optical components sector in general? Even as the recovery comes around, who's really going to make money here?"

the money is probably one or two layers up from component vendors... Kodos for Paxera getting cash, but what did they promise?
SIVROCX
SIVROCX
12/5/2012 | 4:07:37 AM
re: Paxera Packs Tunable Lasers
I can not for the life of me understand why people keep pouring more money into tunable lasers without also focusing on "a cost effective" tunable receiver. I guess when all you have is a hammer everything looks like a nail! +£
o-man
o-man
12/5/2012 | 4:07:34 AM
re: Paxera Packs Tunable Lasers
Craig,

Are their any PLC based tunable lasers being developed? I know a few "cost effective" lasers that have fallen... BW9 for one...
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