Microsoft's Enduring Google Envy

April, 2016

Quite a few articles have been written over time about the jealousy suffered by Microsoft over Alphabet’s Google, but they have not really addressed that the same dynamic exists in the optics realm. One cannot help but discern the palpable pain caused by the dominant search engine provider to the software giant in having a bigger fiber optic network despite the latter starting its construction on its infrastructure in general about two decades earlier. Most interestingly, the characterizations of leaving Google (as well as others) in the “digital drone dust” or offering “dramatic new ways of running big data applications,” as it relates to its partnership with Inphi is way over-the-top rhetoric in that the adoption of this technology is just an extension of Microsoft’s strategy at 10G for short distances. At an OIF workshop that took place in Anaheim during the week of OFC...

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Infinera: Doubling Down on Lost Cause

February, 2018

After bringing in an executive, who promotes to companies he will “lead a transformational charge to growth, profitability and long-term value,” in our opinion, the last earnings call at Infinera was in general just more of the same strategy, only the messaging was more convoluted than ever. While it would be very difficult at this point to figure out a way to put the vendor on a healthier path, just being confined to the literal, cosmetic, and superficial goal of “enhancing internal alignment between our engineering, product management, and marketing teams, and ensuring efficiency in our overall development process” is barely sufficient. If Infinera has any chance for survival, it needs to drastically cut back to a minimum number of products, which have the best chance for success, and give up considerably on its planned aggressive R&D expenditures. Last November, it is quite...

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Infinera: Potential for Exit by Chip Firm Buyout

November, 2020

fibeRealty has speculated in the past about Infinera doing a spinoff of its DSP/PIC combination. However, given the current intensity in the consolidation of semiconductor vendors, and the supplier's extremely low valuation, a chip supplier might consider buying the entire company, and then either manufacture-discontinue or sell off everything, but the ICE-related components. Unsolicited, the next CEO at Infinera, David Heard, volunteered the following during the last earnings call: "I think recently, we've seen the demand for optics, DSPs have a, let's say, scarcity and a very, very high multiple in terms of the demand, as you've seen by the purchase of Acacia and the recent purchase from Marvell or intent to purchase Inphi. And so we think it's a very, very good place to be." He then also stated: "It's good for our business model, good for the customers." Heard also seemed to be quite...

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