JDSU
Infinera - The Optical Component Company That Wasn’t
Infinera (INFN) had a very successful first day of trading after seven years of working counter to the popular and misguided beliefs of a Gilderesque all optical future.
Great controversy surrounds the company and investors wonder whether the valuation attached to company is justifiable. The valuation is indeed debatable and is predicated on their success penetrating the PTTs & Bellcos.
Five Misconceptions About the 10G Optical Market
I’ve noticed a common trend during conversations with investors and analysts about the state of the optics market. People seem to be staking their hopes on 10G as the growth driver for the industry. I firmly believe this is true, but people are assuming the gains will be evenly distributed among all players. Here are the common misconceptions:
Cornering the Commodity Market
The most under-reported but most significant announcement at OFC2007 was Finisar’s (FNSR) Fiber to the Home (FTTH) product. Most optical vendors are communicating their intent to NOT make a product for FTTH or Passive Optical Networking (PON) applications. When the worlds highest volume optical module supplier decides to go the opposite way, something noteworthy just happened.
Finisar FQ307 Earnings Commentary
Finisar (FNSR) reported revenue Monday evening of $107.5M. No written transcript of the call is available, though a replay is and the company overview was updated. I thought there were three notable announcements.
Why JDSU Bought Picolight
JDSU (JDSU) announced that they are acquiring Picolight, a maker of VCSEL based optical transceivers. This is yet another example of healthy consolidation in the optical components business, which ultimately will lead to a better business environment for all- except for the customers like Cisco that exploit the oversupply situation. And Cisco is the likely reason JDSU bought Picolight in the first place.
Death of the All Optical Network - Gilder Telecosm 2006
Infinera took the bold and stunning risk of angering the Gilder priesthood by illustrating that an all optical network was not the future and not the best solution.
Finisar & Luxtera - Gilder Telecosm 2006
The Gilder Telecosm 2006 conference is punctuated by sponsor company presentations. This session had the CEOs of Luxtera and Finisar (FNSR) presenting, followed by moderator and audience Q&A. I was really looking forward to this discussion given the work I’ve done on SFP’s and Cisco.
What’s Going On in Optical
OK, since I’ve been called out by Om Malik, I’m going to let rip with a stream-of-conciousness monologue on optical. No backspace key, no delete key, spelling corrections ex-post-facto. Here goes.
Head Down, Working
Received a couple emails and a Yahoo! IM today with the same question… why no blogging?
I’m working on a detailed study on optical modules. I think I’ve found something particularly interesting.
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SFP+ … Yet Another 10G Optical MSA?
This article is an anonymous submission from a dedicated reader and frustrated engineer
A decade or more ago life as an “optical guy”…as grad student or a professional, revolved around fairly simple things…moving photons over here, a little “guvment” money over there, a product or two now and then…good times, good times. And if you were lucky enough to score a (gasp!) postdoc (swoon!) at Bell Labs, why ANYONE would work grueling hours for Dickensian low pay for a chance to work on things like… SONET…. DWDM… FIBER… BANDWIDTH… DATACOM…
Economics, ROI, quarterly growth, P/E, investor guidance and things of that sort, well that simply did not matter. For the truly patient investor, the general idea of a “boutique investment” applied well…a fairly complex science understood by the few in service of fewer still.
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Bookham, China, and the Optical Component Market
Recently, I sat down with Giorgio Anania, CEO of Bookham Technology (BKHM). We discussed a number of things, including the emerging competition of Asian optical component manufacturers. My conversation with him was about the industry in general, and not specific to Bookham.
We like to identify macro technology trends and disruptions then determine the best way (if any) to invest in them by following up with individual technical (as in technology, not charts) and financial analysis. Discussions with gentlemen like Giorgio Anania help me start this process. At this time I’m far from finishing it.
One trend I see unfolding is the emergence of Chinese optical component companies. Every company is moving their labor intensive component manufacturing to Asia (including Bookham) either through outsourced manufactuing or directly owned facilities in low-cost labor areas.
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Why I Don’t Own Optical Component Stocks (yet)
A common question I receive is “What optical component equities do you like”.
My answer is pretty simple.
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Intel’s Communication Group - Destiny Fulfilled
Intel corp (INTC) lands on Page A1 of the WSJ with a story covering their Analyst Day presentation in New York yesterday. The big news that is getting widespread coverage in many media outlets- including BusinessWeek - is that they are cutting $1BB (8%) in spending but without across the board job cuts.
The big problem is Intel’s work force grew 17% in the last year alone. So, the obvious path is to find businesses with high costs and low revenue, and spin those out to people who can manage them tighter. It sounds like this is exactly what Intel plans to do.
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