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Optical components

Report: OADMs Growing Strong

It wasn’t all that long ago that Optical Crossconnects looked as if they were the wave of the future. But that was before the world was turned upside down, and the market for equipment that can link together thousands of wavelengths all but fizzled out.

In a world where long-haul has become a dirty word, it would seem that more metro-friendly optical add/drop muxes (OADMs), which peel off streams of light signals from bundles of wavelengths passing through a node, have taken over and are paving the road to the optical future.

Despite the meltdown in the industry, the OADM market is actually growing in leaps and bounds, according to a recent report, published on Light Reading on Wednesday (see Optical Add/Drop Muxes). That report, written by Lawrence D. Gasman, president of Communications Industry Researchers Inc. (CIR), states that between 2000 and 2006, the OADM market is set to grow at an average rate of 52 percent a year.

But while that might seem like a big and promising number, it’s worth noting that the growth is starting from very small numbers, and Gasman expects the market to reach only about $265 million by 2006. While OADMs have been available for the last five years, it has only been for the past year or so that they have been the focus of growing interest at all levels of the optical value chain, according to the report.

Gasman also warns that it’s a confusing market, one in which no one player can expect to reap all the benefits. Today, there may be as many as 40 manufacturers that have OADM subsystems products, he writes in the report. In addition, “No carrier yet appears to be on the verge of spending very large amounts of money on OADM functionality.”

Some companies are, however, expected to fare better than others. The two main players in the market, and the winners for the time being, are Corning Inc. (NYSE: GLW) and JDS Uniphase Corp. (Nasdaq: JDSU; Toronto: JDU), with Corning taking the lead. These two companies are expected to benefit from the industry’s newfound emphasis on cost and stability in the face of the telecom depression. “[M]ost large system companies are happy enough with what JDS Uniphase, Corning, and a handful of established second-tier players are doing in this space,” Gasman writes. “Any OADM subsystem manufacturer that believes it can successfully compete on the basis of its ‘advanced’ technology is going to be sadly mistaken.”

To successfully compete in this market, Gasman says companies must emphasize their vintage and their stability, as well as the capex and opex savings their OADMs can provide. Among the companies expected to offer JDS Uniphase and Corning some competition are Agere Systems (NYSE: AGR), Avanex Corp. (Nasdaq: AVNX), Oplink Communications Inc. (Nasdaq: OPLK), and Alliance Fiber Optic Products Inc. (Nasdaq: AFOP).

For startups that have good products, but no vintage to boast of, Gasman suggests that their best bet is to OEM their products through larger components/subsystems firms.

There are indications, according to the report, that the OADM market will be carved up between those that choose to pursue the simple, low-cost, predominantly thin film filter (TFF)-based solutions, and those that want to take a more complicated, high-end route. To succeed, the first group will have to combine its cheap production with strong quality control. This, the report states, can be best achieved by American and Japanese companies with manufacturing plants in Asian countries like China and Taiwan.

With their huge resources, Corning, JDS Uniphase, and a few others can choose to pursue more sophisticated solutions. While most OADMs available today are fixed OADMs (FOADMs), which provide a specific wavelength to be added and dropped, these companies are moving into the emerging category of reconfigurable OADMs (ROADMs), which enable wavelengths to be selectively added and dropped through the use of software-controlled switching or tunable-filter mechanisms.

— Eugénie Larson, Reporter, Light Reading
http://www.lightreading.com Want to know more? The big cheeses of the optical networking industry will be discussing this very topic at Opticon 2002, Light Reading’s annual conference, being held in San Jose, California, August 19-22. Check it out at Opticon 2002.

Register now and save $500 off the registration fee. Just use the VIP Code C2PT1LHT on your registration form, and deduct $500 from the published conference fee. It's that simple!

let-there-be-light 12/4/2012 | 10:00:49 PM
re: Report: OADMs Growing Strong ....and you wonder why they chose to call it optiCON
redface 12/4/2012 | 10:00:49 PM
re: Report: OADMs Growing Strong Hello.......................
Belzebutt 12/4/2012 | 10:00:47 PM
re: Report: OADMs Growing Strong It took me a while to catch on that you're talking about OADM components, not OADM boxes. I was wondering why you talked about JDS and not Nortel or Lucent, and why the market was so small.
edgecore 12/4/2012 | 10:00:40 PM
re: Report: OADMs Growing Strong The article would have been a lot more useful if some kind of education came along with it.

If an all optical switch, or even a hybrid backplane switch, drops and picks up any traffic, is it automatically an OADM...how do you distinguish?

THX

EC
diffraction 12/4/2012 | 10:00:40 PM
re: Report: OADMs Growing Strong

If the more sophisticated dynamic OADM
approachs can pass all the reliability testing, it should be much cheaper than the TTF discrete component solution even though they offer dynamic
wavelength routing.

By the way, the new dynamic OADMs have the Mux/Demux AND an effective cross connect build in! So lightreading needs to do a little more analysis on how it compares switches and OADMs.

Also the new OADM architectures offer costs well below the current $100 per channel MUX/DEMUX of an AWG and well well below $300 per VOA channel but these OADM architectures need to time to prove their reliability and system robustness.


In the future the entire optical plane will
consist of just three integrated products: amplifiers and dynamic OADMs, and tuneable lasers . There is no need for anything else.

A few serious startup challengers to JDSU and Corning were neglected mention: Nework Photonics, Lightconnect, and Silicon Light Machines.

My guess is that Corning and Avanex are based on liquid crystals; JDSU, a mixture of liquid crystals and MEMS; Network Photonics MEMS based, and Lightconnect and SLM new technology call diffractive MEMS.

Only time will tell which technology and company will win the lions share of the dynamic OADM market. My guess is all will eventually achieve
similar performance and the lowest cost approach
will be the big winner.
52775 12/4/2012 | 10:00:38 PM
re: Report: OADMs Growing Strong "A few serious startup challengers to JDSU and Corning were neglected mention: Nework Photonics, Lightconnect, and Silicon Light Machines"

...and don't forget Litton PolyScientific, now owned by Northrop Grumman (Component Technology division)

they have an OADM presently in development...

are have kept it hush-hush
waverunner 12/4/2012 | 10:00:29 PM
re: Report: OADMs Growing Strong I read that report from Gasman, although he accurately positioned OADM technologies, Gasman obviously has no systems application knowledge had he just picked up the phone and spoken to any tier 3 network planner he would have found the following...

In a LH application, a cheap fixed OADM will do the job. IXC's are dropping in Medium City, USA two, three, max four lambdas. A fixed OADM will do the job. DSE? WRM? No need. Not for a long while? But the OADM knell rings long. Why? In any large city , the all-photonics will say otherwise, but you require O-E-O. You need the granularity! That is why Lucent's Lambda Router (WRM) makes a good vending machine in standardization labs and XROS is cancelled.

In the metro space, you would think that you require tons of OADM's, especially ROADM's. The article makes mention "cost is king" and leans towards cheap fixed OADM's. Tons of growth? Not really. That space is full of POP's that require DS1, Ethernet granularity (IOF you need STS-1), grooming at that level is done at the electrical level not optical.

The claim of OADM's "growing strong" made by Gasman has well...no gas.

-Wave
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