Strategically Blogging

Shonika Vijay

High-End Lighting Markets for Solid State Lighting

Shonika Vijay 09/30/2014

Lighting has always been seen as a commodity market. In fact, most people buy their light bulbs from the same place they buy their milk. It is a price war out there with slim profit margins on lighting products; meanwhile, the market keeps demanding higher quality. The general indoor lighting market mostly consists of the following form factors: downlights, troffers, suspended pendants, track lights, and high bay lights (a detailed market report of general lighting luminaires with these form factors along with all technologies will be released this November). Downlights and troffers make up the majority of the installed luminaire base for all regions. In order to compete for penetration in these installed luminaire bases, LED lighting has had to slash its prices while making sure it can sustain the light output levels of halogens, incandescent, and fluorescent technologies.

Fiber Laser Market Continues to Evolve

Allen Nogee 09/05/2014

I’ve always been a person who has been very interested in the latest technology, and sometimes it’s hard for me to believe how much technology has changed over the years.

Everything from flat screen TVs, DVRs, audio equipment, cables and wiring, computers, tablets, smartphones, and so many others have evolved over the years, and in most ways, the new technology is quicker, smaller, cheaper, and more energy efficient. Today we take all these things for granted, but it wasn’t that long ago that a flat screen TV or a smartphone was a novelty. Today we just can’t even imagine living without these things.

Martin Shih

A Win-Win Situation: Cree Announces Investment in Lextar through Private Placement

Martin Shih 09/05/2014

Cree recently announced plans to invest US $83M in Lextar Electronics, one of Taiwan’s major LED manufacturers, in order to acquire 13% of Lextar shares and to enter a supply/royalty agreement. Cree will become Lextar’s second largest shareholder (AUO, Lextar’s parent company, is the biggest shareholder) and obtain one member of BOD. This deal is expected to be done at the end of 2014 and the lock-up period is 3 years, which means Lextar will reserve its capacity for Cree for 3 years.

Lasers in Medical Imaging: The Forecast Looks Very Bright

Allen Nogee 07/11/2014

Almost all medical imaging to date has used one of three technologies: X-rays, magnetism (MRI), or ultrasound. X-rays alone have been used for almost 120 years now, and although today’s imaging technology has improved vastly over the many years, the fact remains that x-rays, ultrasound, and magnetism are all technologies that, due to many factors, produce coarse images, at least by today’s standards. But what if a very coherent light source was used instead, maybe a laser?

Actually, Optical Coherence Tomography (OCT), which produces images based on the reflections of coherent light, is not a new technology. OCT has been used since the early 1990s, especially in the area of ophthalmology, where the images produced by OCT are 100 times finer than standard images produced by ultrasound. In just the last five years, OCT has become one of the most important retinal imaging techniques used today.

The Impact of the Epistar Acquisition on the LED Industry

Martin Shih 07/09/2014

Epistar (2448.TW) announced a plan to fully acquire Forepi (3061.TW), the second-largest chipmaker in Taiwan, through a share swap (1:3.448), implying 18% share dilution to Epistar. The effective date will be the end of 2014, and Forepi will be delisted from the TAIEX.

After the merger, Epistar will become the world’s largest LED chip maker in terms of capacity with a global market share of 15%, which will better position the company to lead in future technology development.

Big money for photonics in data centers

By Tom Hausken
The best news that photonics people could hear came last week at OFC when Cisco announced that it was buying Lightwire for $271million in cash. Lightwire is a start-up making integrated photonics , and Cisco is interested in it for making interconnects in data centers, among other things. I try not to get intoxicated with financial ups and downs that ultimately benefit only a few investors (if that),and I'm not fond of buzzwords like "integrated photonics," but this is good news for anyone with a similar technology.


It makes sense that Cisco needs the expertise developed in Lightwire. Companies have spent millions on this; for Cisco to do it itself would take millions more and years of delays. Meanwhile, its competitors--Huawei for one--are encroaching on Cisco's market with technology of its own. Cisco can't rely on the merchant market for everything.


The data center bottleneck is particularly important. I attended four discussions on the topic, including the OIDA workshop to develop a roadmap (where I was a moderator and am writing the report). The challenge is for the industry to develop new architectures and inexpensive components that can address the many-to-many interconnects necessary in modern data centers, such as those of Google and Facebook. Traditional data centers are not a challenge: a conventional switching hierarchy can store and retrieve data, and that scales predictably. The new data centers don't scale as well.


Both Google and Facebook made the rounds at OFC, and both claim that the technology is available today, it just has to be commercialized. They say there needs to be a whole new sector of components that don't need to meet Telcordia and NEBS standards. It just has to be good enough for the controlled data center environment. Oh, and make it really really cheap, thank you.


The one problem I have will all of this is that the net margins for Google and Facebook are about 25% or so. That's net profit, not gross. The optical components suppliers' net margins are a few percent to negative. So how about giving some of that nice margin back to the components suppliers? Especially as many suppliers don't see the return on this new segment justifying the risk.


That's why Cisco's acquisition is such good news. It's a return for the start-up's investors, but it also means that Cisco is willing to fork over some real money for components.


The OIDA roadmap report on data center interconnects will be coming out sometime in the coming weeks. Look for it at the OIDA web site or here .

ABOUT US

Strategies Unlimited

offers comprehensive coverage of high-brightness LEDs and LED lighting, lasers and other photonic products and systems, biomedical imaging systems and image sensors, compound semiconductor materials and specialty electronics market sectors.


MEET THE ANALYSTS

The experienced analyst team at Strategies Unlimited offers comprehensive coverage of high-brightness LEDs and LED lighting, lasers and other photonic products and systems, biomedical imaging systems and image sensors, compound semiconductor materials and specialty electronics market sectors.
 LEARN MORE