Strategically Blogging

Will the lack of an Energy Star Certification Affect Sales of Philips New Lamp?

Philip Smallwood 05/27/2015

LEDs Magazine recently released an article on Philips’ new sub-five dollar 60W equivalent LED lamp, which describes how the company was able to make a less expensive LED bulb by using lower priced mid-power LEDs, which decreases the lifetime to 10,000 hours and is not fully omnidirectional.

With More LED Street Lights Comes More Connected Lighting

Shonika Vijay 05/19/2015

Lighting communication has been a hot topic for the past couple of years. We usually come across them in headlines such as cities installing smart lighting, cities getting connected, cities installing lighting controls and etc.

Ultrafast laser evolution

Allen Nogee 04/30/2015

Currently I am working on a report on ultrafast lasers. Many of these types of lasers have existed for many years, and they can do incredible things, but the total market remains relatively small when compared to some other laser segments. The ultrafast laser market is like all laser markets where specialized tools are matched to applications requiring them.

Laser Choices Improve Along with Laser Specs

Allen Nogee 03/18/2015

Having just finished all the forecasts and estimations of the recently released report, The Worldwide Market for Lasers 2015, this is the time I step back and look at last year’s laser market in retrospect. It is quite common for industry analysts (myself included) to attempt to “fit” a market they are investigating over other markets which have proceeded it. This is a part of normal human experience - mapping the unknown to what they do know. Unfortunately, what I have found from my experience in technology, 30+ years actually, is that no technology really duplicates another in evolution, no matter how much they may appear similar at first glance.

Key Takeaways from the 2015 China LED Signage Show

Martin Shih 03/16/2015

Strategies Unlimited was invited to present at one of the world’s biggest LED Signage Shows, giving an overview of the worldwide LED signage market and trends for 2015 during the conference. We will also update our signage market data in our upcoming report, “The Worldwide Market for LEDs 2015,” which will publish in April. Although this conference was held right after the Chinese New Year Holidays, which led to fewer attendees than 2014, we still saw all the major LED signage suppliers demonstrate their latest LED signs and outdoor/indoor displays for 2015. 

Consolidation, Part 2--Is Oclaro consolidation or redistribution?

By Tom Hausken
So Bookham and Avanex finally merged, forming Oclaro . This is a sign that the industry is consolidating, right? Reducing the number of suppliers by one, yes. But it may just amount to moving market share around, and not necessarily to fewer players.

Bookham and Avanex don't have greatly overlapping product lines. And the new management claims it will continue manufacturing parts the way it has been. That is, it will keep the Bookham fabs and its Shenzhen facility but will also keep using Fabrinet as Avanex did.

The company points out that now they have a wider range of products to compete against bigger competitors, like JDS Uniphase and Finisar. I've never fully believed the one-stop-shop argument though. Of course, Cisco and any other customer would like to reduce its list of suppliers. But the customers also want suppliers to be competitive, and they want the best products they can find, provided that the supplier is qualified. Grouping products into one company doesn't necessarily make Oclaro more competitive in those products.


There will certainly be some synergies gained from consolidating various functions, such as procurement and corporate overhead. The figure shows Oclaro's vision of the gains it can make in gross margin from the merger. One of the bigger synergies would be the use of the Bookham fabs to supply chips for Avanex products. This is a change in market share, shifting sales from the former suppliers (such as JDS Uniphase) to Oclaro, possibly improving Oclaro's factory utilization. It might also steal some margin from contract manufacturers.


Source: Oclaro


That may turn out real good for Oclaro, although it doesn't necessarily constitute consolidation if it just spreads market share more evenly among some of the bigger players. Without knowing how it plays out product by product, it could actually increase competition and reduce consolidation in some segments.

Oclaro's CEO Alain Couder notes that the company also gets to spread Bookham's credit line over a new balance sheet that is low in debt and with a nice chunk of cash. That's never a bad thing, for Oclaro. And despite claims to the contrary, the management may make more moves once the excitement has died down. Anything that tips the scales dramatically in Oclaro's favor would essentially increase consolidation, even if the number of suppliers is nominally the same.

This may turn out real good for Oclaro. But I wouldn't call it industry-scale consolidation. Not yet.

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