Inphi/ClariPhy: Solider Acquisition Aspirant

January, 2017

fibeReality believes that the factor that makes Inphi the most attractive as a buyout candidate is its recent purchase of ClariPhy Communications. With PAM4 technology yet to be sold in any kind of volume by any vendor, Inphi can potentially provide the necessary engineering and financial resources to fully develop a high-end coherent DSP to the merchant market that would provide an alternative to Acacia Communications, which has been able to monopolize the space. As we have discussed in the past, the lack of a second supplier makes differentiation highly problematic for those system vendors, which do not internally develop their own DSPs for these applications. Assuming that NEL does not come out with its own version of this kind of processor, which would be a compelling competitive solution, a duopoly situation would also help ensure that any kind of pricing wars would be kept to a...

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$2B AOI Cap Worse Than Old $3B Acacia

July, 2017

  While we would find it impossible to ever recommend securities of any kind because of the irrational ups and downs of the prices, we have a great deal of respect for many of the financial analysts to whom we provide consulting services on a regular basis, and they tend to be conscientious, informed, and trustworthy. Nevertheless, those people in the industry who have direct access to our second blog by following us there, realized that we felt compelled to publish the following article the other day: “Mind-Boggling Amount of Ignorance About Optics on the Street?” It was a directly a reflection of a “very close to an obscene” valuation of Applied Optolectronics, which has been hovering around the $2 billion mark for a while, and in our opinion, has been spurred on by too many individuals influencing optics stock prices, who are disingenuous, unknowledgeable, or unwilling to...

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MACOM and Fabrinet: Sound of Silence

August, 2017

On our daily market perspectives page, we have been discussing the mystery surrounding the lack of discussion on Amazon at public events involving MACOM Technology Solutions and Fabrinet. While there is not access to what was totally addressed at these conferences, as we go to publication of this article, it appears that both of the companies are ignoring the opportunity, and for whatever reason, the financial analysts at these meetings are not asking any questions on the matter. As a result, there remains only the notes of one investment firm, which was likely selected for being the most bullish on the optical space recently, as the only obvious source of the apparent agreement between the three companies. However, as we pointed out on our last blog post, even if Amazon were to change its mind in building its own 100G CWDM4 devices, the jolt of the possibility has already affected...

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Inphi’s 100G DSP: Another Blow to Acacia

September, 2017

As usual, when a vendor, such as Inphi, makes a series of announcements on products or on R&D direction, the bulk of the attention is always on the most cutting-edge feature or solution, not necessarily the most practical, which would frequently be more inclined to ultimately make the most money for the company, especially over the very long term.  Its new COLORZ-Lite is really just an extension of a niche product. There is a lot of emphasis on Inphi’s development of 50-gig and 100-gig IOs, not taking into account how much further 25G should remain competitive, including our expectation that NG-PON2 will likely become the de facto access standard for most of the world (which we addressed in real time during a 5G workshop at ECOC 2017), not to mention the technical challenges in moving to these higher serial rates. Naturally, even with the LightSpeed-III M200, the focus on the name is...

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Finisar/Oclaro: Nearsighted Beyond 4x50G

November, 2017

As with fibeReality, both Finisar and Oclaro have problems foreseeing 400GbE in any meaningful way in the anticipatable time ahead. While each is more than glad to mention development efforts in this direction, their powerful statements included in a couple of recent articles on Gazettabyte cannot be dismissed. An executive from Finisar said, “There is probably more technical risk in 400 gigabits than any of the historical data-rate jumps we have seen.” The Chief Commercial Officer from Oclaro said, “The industry really wants four channels. When you use more lasers, you are adding more cost." In addition, with the expectation of NG-PON2 becoming the de facto standard for at least many large portions of the globe, 25G will even have longer legs. Any vendor that can produce a low-cost 25G laser will be a big winner in the future optical access space. All in all, it is not even that...

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