OFC 2017 – Coherent Technology

400G Coherent and Beyond
Ciena had a blockbuster announcement at OFC 2017, but there was plenty of other interesting news to feast on. Cignal AI’s key takeaways concerning coherent WDM include:

  • The outlook for 200G and CFP2-ACO volumes in 2017
  • Opinions on Ciena WaveLogic Ai Licensing
  • The roadmap review for 400G/600G & Acacia Pico
  • Sizing the risk and reward for the 400G ZR market

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Investor Call – OFC 2017 Takeaways

Piper Jaffray logo

Andrew Schmitt provided key OFC 2017 takeaways during an investor call hosted by Troy Jensen of Piper Jaffray. Sixty-seven investors participated. Topics of interest included:

  • Impact of Ciena’s Wavelogic AI DSP Licensing
  • Outlook for Coherent Port Shipments in China During 2017
  • Market Outlook for CFP2-ACO/DCO and QSFP28 Markets
  • Potential Vertical Integration by Intel or InPhi
  • Timing of Metro Coherent and ROADM deployment in China
  • Chinese SARFT Capex Guidance
  • Roadmap for 400G and 600G Coherent
  • Observations on Infinera, Ciena, Acacia, Oclaro, and Neophotonics

Following is a summary of the key takeaways, as well as a full transcript of the discussion. Cignal AI clients can also listen to an audio replay.

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Ciena Wavelogic Ai and 400G Roadmap

Wavelogic AI

This past October, Ciena announced its new coherent DSP, dubbed Wavelogic Ai. Ciena used the announcement to convey its coherent 100G+ roadmap and support for 400G. Ciena also hinted at important changes to its 100G+ business model as Wavelogic Ai is introduced to customer networks. These changes also cascade into the 400G component supply chain.

Wavelogic Ai doubles down on Ciena’s strategy of vertical integration of the DSP and optics, and extends it further into the control plane. The company continues to eschew the use of outside suppliers like Acacia, NTT Electronics, or Clariphy. We believe Ciena’s vertical integration is the company’s strategy for successfully competing with commodity hardware and dis-aggregated networks.
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Investor Call – China 2017, CFP2-ACO, Coherent DSPs

Piper Jaffray logo

Andrew Schmitt gave an update on the optical equipment and component market during an investor call hosted by Troy Jensen of Piper Jaffray on Tuesday, October 4. Sixty-eight investors participated. An extended Q&A session followed Andrew’s presentation, and topics of interest included:

  • China 100G port volume trends for 2H16 and 2017
  • Huawei’s upcoming 100G technology decisions and supplier purchasing shifts
  • CFP2-ACO shipments and the component & equipment supply chain for this product
  • Coherent DSP R&D developments and supplier updates
  • Updates on direct-detect 100G and PAM-4 development
  • Observations on Infinera, Ciena, Acacia, Inphi, and Clariphy and discussion of potential M&A activity

Following is a summary of the key takeaways, as well as a full transcript of the discussion. Cignal AI clients can also listen to an audio replay.

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ECOC 2016 Notes and Observations

ECOC 2016 Logo

Andrew Schmitt presented at the ECOC (European Conference for Optical Communications) in Dusseldorf, Germany during the week of Sept. 19. No time was wasted during the trip as Andrew fit in well over 30 scheduled meetings with component and equipment suppliers and end users of optical hardware.

The meetings were very productive and we gained new insight in several areas:

  • Huawei’s plans to transition to 100G CFP-DCO technology and what will follow
  • Updates on vendor selection and R&D in coherent DSPs
  • Details on the ongoing ramp in CFP2-ACO and the development of this new market
  • Overview of 400G market development
  • More insight into Nokia’s China Mobile optical design win

Requires Optical Active Insight subscription

Acacia Communications – IPO Analysis

The optical networking world finally gets a close up view of Acacia’s performance as the company is filing for an IPO. The most recent S-1/A filing by Acacia includes 2015 financial details, which we review through the lenses of Cignal AI’s customer and market knowledge in order to create a fine-grained view of the company’s performance and qualitative outlook. This analysis includes a detailed projection of customer composition for 90%+ of revenue, market share within entire 100G market, and estimates of ASPs beyond what is included in public documents.
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