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Technology Stocks : ORTEL -- Ignore unavailable to you. Want to Upgrade?

To: craig crawford who wrote (421)	2/16/1998 4:28:00 PM
From: Jerry C.	Read Replies (1) \| Respond to of 659

An article I read: Ortel sees broadband opening Loring Wirbel Alhambra, Calif. - The Ortel Corp. that broke out of California Institute of Technology in the early 1980s to commercialize semiconductor lasers is barely recognizable today. Though the company's continuous-wave lasers remain critical to hybrid fiber/coax systems, Ortel is expanding its reach throughout the broadband infrastructure, including wireless networks and wavelength division multiplexed (WDM) fiber backbones. May and June were months of aggressive deal-making for the communications specialist, which racked up $57.7 million in revenue in 1996. Qualcomm Inc. (San Diego) agreed to license Code Division Multiple Access algorithms for use in Ortel's wireless repeater products. And Ortel participated with several venture firms in helping a Bellcore group split from its new SAIC Corp. parent to form Tellium Inc., a newcomer with a mission of developing dense WDM equipment for multi-gigabit backbones. As a minority investor, Ortel will have rights to integrate Tellium's WDM technology in the company's own products. Ortel chief executive Wim Selders said that the merging of many previously discrete broadband markets into hybrid networks allows the company to utilize strengths across divisions. For example, Ortel became familiar with cellular and PCS markets by providing fiber backhaul networks for basestations and mobile switching centers. When the company acquired the wireless-repeater business of Avitec AB of Sweden in 1996, it already had expertise in selling into cellular and PCS markets. End-market diversity is critical, since particular markets have seen slowdowns because of the uncertain status of broadband buildouts. HFC infrastructure sales to the cable industry should have been a sure thing, for example, but the travails of Tele-Communications Inc. in 1996 caused many cable multiple-service operators to postpone the introduction of fiber into their networks. Ortel's vice president and business manager for broadband communications, Robert Jordan, said that it is important to not misinterpret MSOs' short-term problems in capital availability as a long-term disinterest in broadband. Carriers of all types remain committed to fiber buildouts, he said, and the passage of the 1996 Telecommunications Reform Act will likely hasten the eventual move to a universal broadband infrastructure. In the meantime, Ortel's acquisition of Avitec and licensing deal with Qualcomm will strengthen the PCS business at a time when 1.9-GHz voice networks are being developed nationwide. The interesting test case for the future will come in WDM markets. Ortel's 980-nm pump laser has become a standard for both traditional Sonet backbones and WDM-enabled fiber systems. The investment in Tellium does not indicate a long-term desire to directly own a WDM system company, Selders said, but does show that Ortel wants to find more immediate applicability for its laser technology in WDM markets.