Here's a quick summary of the MSDW presentation:
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JDSU presentation from MSDW conference, March 6-7, 2001:
Intro: changing world. Bandwidth. Applications listed, medicine, work, etc. From a computer-centric world to a bandwidth-centric. Computer not important as much as what you can access.
Dilemma of carriers. Data carries 1/7 revenue as voice. Their per minute revs are declining and costs are rising. JDSU can help. New economics for the new economy. Earlier we had single channel that went over short distance. Very expensive, inefficient, slow. Made networks costly. With DWDM we moved to higher channel counts, longer distance without regeneration. We then we further and increased modulation speeds to 10 gigs per second. We got 40 channels. State of the art are 160 channels now, over 400 kms. Long haul systems are going over 2000 kms without regeneration. This has brought down cost of networks, and increased capacity at same time. We intend to partner with our customers to enable this economy.
Foundation is based on portfolio of components and products. This is basis of our module strategy. Customers are not looking for component solutions, they’re looking for transmitters, not single components. You have to optimize module. Carriers want to deploy in six months, not eighteen. Modules are in four areas: trans, DWDM, amplification, and switching.
1) Transmission : electron to photons, modulated and transmitted to other end where a receiver collects it and puts it back into electrons. Standard OC-192 transmitter, “frankly we can’t make enough for our customers today.” (Brand new presentation today.) Next stage will be 40 gig. 160/10 = 1.6 terabits; next gen. Will send 7 terabits per second down fiber. The faster we can send light, the lower the cost to customers. 35 cents for 40 gig persecond.
2) DWDM --- take number of light sources and put them down single fiber. Interleavers separate odd and even channels, create different channel spacing. This allows lower cost components to transfer the light. Complexity can be reduced. 160 channels vs. 16 means lower costs.
3) Optical amplifier is the work horse. Next generation will include semiconductor amplifers and Raman. Decreases amount of amplifiers. The more powerful we make them, the longer distances we go and more channels we send. Lowers cost.
4) Switching --- still in the future. We can do 2X2, 2X8, but beyond that we go back into the electrical domain. We’re focusing on MEMs technology. On a silicon substrate will create a series of mirrors. All-optical switch is the holy grail. It will change the cost dynamics. We see lots of duplication in SONET rings, side by side dark fiber. We will move to mesh architecture. So where there’s a break, you can reroute light in another direction. New revenue opportunities. Bandwidth on demand would be possible. Now it requires workers in the field. Costly. We closed merger with SDLI and added products and technology. AWGs, transmission, amplification, 980 nm, and Raman, and network monitoring. We will need optical monitoring techniques as we move forward.
Eventually we will move from modules to systems on a chip. Silica wave-guides, plus attenuators combined now. Eventually lasers and lockers. Within the world of photonics, it’s different. It’s not really just silica. It will be silica, silicon, GaS, Indium Phosphide, and so on. We now have a transmission group. Actives use semiconductor technology.
We have one face to the customer. We use Oracle platform across the company. 80% now, 100% by June.
Manufacturing automation. Semiconductor world it’s well defined. In photonics, we don’t have much. Why? Definite differences. Normal applications vs. challenges. Fiber handling is difficult. It’s brittle, doesn’t hold shape, can be ruined easily. About the 1/10 the size of human hair. Have to match it up plus get polarization right. Have different tolerances. We deal with nanometers. Alignment to 157/millionth accuracy (?). We dealing with internal resources. Not many places that understand it. We’re defining islands of automation. Working on standardization and design for automation. We have a number of programs underway. About 40 in place now. Lots on assembly. Very immature processes exist now. Our tech is equivalent to semiconductor industry in late 60s and early 70s. Some improvements recently. Lots of testing required.
Financial performance, to date we have seen enormous rise in sales. 18% last quarter, seq; margins above 50%, op margins at 30%. Guidance for two quarters revs will be flat. If we look out further, and where carriers are spending their money, they’re increasing percentage to optical. Networks moving more and more to all-optical. Internet today is a crude version of what we’ll have in the future.
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