Optical networking report predicts rough times

May 4, 2005 — Emtech Research, an Ann Arbor, Mich., micro and nanotechnology market analysis group, released its MEMS optical networking report. Revenues for MEMS devices sold into the optical networking market declined by 27.2 percent from 2003 to 2004, according to the report, although the level of unit shipments remained essentially flat. Once considered the golden child of telecom, MEMS optical component suppliers continue to be battered by poor market conditions.

“Even a new strategy, in which many MEMS suppliers are now offering intelligent modules such as Wavelength Selective Switches (WSS), rather than just components, may not be enough,” said Marlene Bourne, vice president of research and principal analyst at EmTech, a division of Small Times Media. “2005 will be a pivotal year where survival will be the main business focus.”

The report also found that despite current market conditions, MEMS suppliers in optical received $63.5 million in funding in the past twelve months; This year’s forecast is just a tenth of the forecast back in the heyday of late 2000, and half of what was forecast last year; Unit shipments are forecast to increase at a Compound Annual Growth Rate of 9.4 percent over the next five years.


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