Intel, Cisco, Corning in $63 mln deal for optical start-up
SAN FRANCISCO, March 5 (Reuters) - Intel Corp. <INTC.O>, Cisco Systems Inc. <CSCO.O> and Corning Inc. <GLW.N> on Monday joined $63 million in financing for Gemfire, a start-up aiming to make the processing power of optical network components grow at the impressive rates set by integrated-circuits.
Founded in late 1995, Palo Alto, Calif.-based Gemfire has now raised more than $85 million to develop fiber-optic components and their capacity.
According to Chief Executive Richard Tompane, the company sees fiber-optics components developing the way integrated circuits advanced from simple transistors to complex microprocessors.
"We see the same things happening in photonics as in the integrated circuit industry," Tompane told Reuters. "If you remember the early days, people made individual transistors."
Gemfire will display two key products at the Optical Fiber Conference 2001 on March 19-22, to show how optical components can be made more powerful, smaller and less expensive.
"The first component is a Laser Pump Source array," Tompane said. "For the first time it incorporates eight independently controllable sources, which is important because it reduces cost and reduces packaging."
"The second product is a variable optical attenuator, which is much smaller and uses very low power," Tompane said. "When you go to very high channel-count systems of a hundred channels or even a thousand some day, power and foot-print, or the size of the package, become very important. Having a low-power design allows it to go into any environment rather than a very carefully designed central office."
Joining Intel, Cisco an Corning on Monday as Gemfire's other corporate investors were optical subsystems provider Finisar Corp. <FNSR.O> and communications component maker TriQuint Semiconductor <TQNT.O>.
Gemfire's initial investors, venture capital firms Kleiner Perkins Caufield & Byers, Mohr Davidow Ventures, Spring Creek Partners and Hook Partners, also joined Monday's deal, just one of many recent large funding rounds for optical start-ups.
On Feb. 23, for instance, year-old start-up Sigma Networks announced a massive $435 million first-time funding round, which included an investment from Cisco.
Sigma Chairman Reed Hundt, the former Federal Communications Commission chief, told Reuters that the round -- $145 million in cash and $290 million in debt -- showed investors are eager to fund developing technology for boosting the quantity of data transmitted over optical networks.
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