Tunable Lasers: Back in Fashion?
While most tunable laser vendors are hibernating in the telecom winter, startup Santur Corp. is trying to buck the trend.
The company announced an extra $23 million in funding today, which it plans to use to ramp its product to volume production (see Santur Grabs $23M). Furthermore, it has reportedly landed Corvis Corp. (Nasdaq: CORV), and Innovance Networks as customers, say sources close to the company.
Although Santur won't officially confirm this, it appears that both Corvis and Innovance were using its tunable lasers in demonstrations at the recent Supercomm show (see Vendors Aim to Cut Costs in Core). Both Corvis and Innovance plan to announce commercial availability of their platforms in the next few months, the vendors said before the show.
Whether this puts Santur on a path to success remains to be seen. Other tunable laser vendors have found that customers have reneged on their commitments to use tunable lasers, so there's no guarantee that the alleged Corvis or Innovance deals will turn into significant revenues (see Scattered Signals for Tunable Lasers). And industry analysts, including Jeffrey Morgan at J.P. Morgan H&Q Equity Research, generally believe that volume deployment of tunable lasers could still be a year or more away.
However, Santur seems better placed than many startups. For starters, it has money in the bank. Its funding today is only the first closing of the round, says Gurindar Parhar, Santur's VP of business development. It expects to announce a further closing in the next few weeks.
The lead investor in today's round was Thomas Weisel Partners, with existing investors Menlo Ventures and Sequoia Capital also taking part. JDS Uniphase Corp. (Nasdaq: JDSU; Toronto: JDU) also took part as a strategic investor, although Parhar points out that this doesn't mean JDSU is neglecting its in-house tunable laser development.
This brings Santur's total funding to around $43 million in equity, in addition to a lease line of $10 million. Although Parhar doesn't want to say exactly how many employees the company has, he does say it is fewer than 100.
Santur's key selling point, he says, is the fact that its laser offers a wide tuning range and the optical quality of Distributed Feedback (DFB) Lasers -- the type of laser in widespread use in DWDM systems today. In other words, Santur's laser is high power, stable, reliable, and low cost, it claims. Other types of tunable laser don't necessarily meet those requirements, says Parhar, because the technology is radically different from traditional DFB laser technology (see Tune In!).
"The concept of tunable lasers has been around a long time," he says. "What's been missing is one that meets the needs of carriers." Carriers are comfortable with Santur's laser technology, he adds, because it gives the same performance as the lasers they are used to dealing with.
Santur's laser is DFB-like because, in fact, it contains DFBs -- four of them in an array, to provide wavelengths from different parts of the spectrum -- integrated in a chip barely much bigger than a standard DFB chip. A MEMS (micro-electro-mechanical system) mirror couples the output from one of the lasers to the output of the chip. The whole thing is tuned (slowly) by heating and cooling. The product was announced back in March (see Santur Debuts With Laser).
A potential sticking point for Santur, however, is that its laser isn't yet Telcordia Technologies Inc. qualified. Santur is just embarking on this process, which it hopes to have completed by the end of the year. Given that any potential customers will need to have qualified components before they can ship their systems, this means that Santur will not book revenues this year.
Corvis and Innovance could not be reached by press time.
— Pauline Rigby, Senior Editor, Light Reading