Tunable-lasers market grows despite slump

17 Jun 2002

Despite the declining economy, players in the tunable-laser market are making bold statements about growth. Rebecca Pool talks to industry experts to find out why.

From Opto & Laser Europe December 2001

The telecoms industry may be floundering in the current economic downturn, but the market for wavelength-adjustable transmitters (or tunable lasers) remains intact. In fact, the latest reports from market analysts predict that it will see staggering growth over the next five years. One such analyst, the Yankee Group, US, predicts that today's revenues of USD 50 million will grow to USD 2 billion by 2006.

Jay Patel, senior analyst at the Yankee Group, says that although the current economic climate has had some effect on the tunable-laser market, growth will still occur. "The economic downturn means that we are starting from a lower baseline," he said. "But we are still seeing growth and we are just as optimistic as before."

According to Patel, tunable-laser-market growth is likely to track the ever-increasing demand for greater fibre capacity in fibre-optic networks, whether for long-haul or metropolitan markets. Dense wavelength-division multiplexing (DWDM) technology has increased the number of commercially available transmission channels in fibre-optic networks to 40 wavelengths per fibre, and the technology already exists to raise the number of channels to as many as 172 wavelengths per fibre.

But while this may sound like the ideal solution to data-hungry consumers, the reality is a logistical nightmare for network operators. Existing DWDM networks typically use a unique laser for each wavelength in the transmission fibre, and as the number of channels in DWDM networks increases, more fixed-wavelength lasers are needed. From the service provider's point of view, stocking spare capacity is complex and costly, unless it uses tunable lasers.Unlike their fixed-wavelength counterparts, tunable lasers can transmit over a range of wavelengths, which means that the service provider needs to stock only a minimal number of spares. Fujitsu Network Communications, the US fibre-optic arm of Fujitsu, Japan, is already using narrowly tunable lasers that tune over four channels in its DWDM systems. With plans to move to 22 channels by the end of the year, Fujitsu is just one of a number of early adopters. Other incumbents such as Alcatel of France, Nortel Networks of Canada and US-based Lucent all expect to reach volume production by the end of 2001.

It is not just the big players who are making waves in this relatively new market. Start-ups that have already made a name for themselves include US-based firms Agility, Bandwidth9, BlueSky Research, Iolon and Sparkolor. Patel says that Agility, which announced its tunable-laser product in November last year, plans to increase its laser-manufacturing capacity from this year's 50 000 to 1 million by 2003.

While inventory management and sparing is the main tunable-laser application today, other applications will follow. As old transmission links are replaced and new ones are installed, it will be possible to use tunable lasers instead of fixed-wavelength sources in DWDM systems.

Jens Buus, technical director of UK-based consultancy Gayton Photonics, believes that this is an essential step towards ensuring flexibility in DWDM networks. He also believes, however, that the cost of tunable lasers must first be reduced. "Sparing is less sensitive to cost issues, but for tunable lasers to be used as replacements, prices need to be lower," he said.

Patel agrees, and says that system manufacturers will pay a 25% premium for narrowly tunable lasers, and a higher premium for widely tunable sources. "The price is still a little too high, but once the cost of tunable lasers becomes equal to that of fixed-wavelength devices, we can expect to see rapid adoption," he said. "I expect this to happen by the end of 2004."

Looking even further into the future, tunable lasers have the potential to bring new possibilities to network design. The routing of optical signals to different locations within a network architecture is determined by the signals' wavelengths. If a tunable laser is employed in the transmitter, it is possible to re-route the wavelength to any network node.

One firm that has incorporated tunable lasers into its WDM platform for this reason is US-based Atoga Systems. Currently trialling Agility's 40-channel tunable laser in its systems, Atoga's vice-president P G Menon believes that these lasers are essential to bringing "intelligence" to a network. "If, for example, the traffic demand in a network changes, tunable lasers can alter their wavelength to match the demand," he said. "This is a real benefit to service providers, because it means that they don't have to physically do it themselves."

Menon also says that following laboratory and field trials of his firm's DWDM platform, vendors that were sceptical about tunable lasers 18 months ago are now happy with their results. Unfazed by telecoms woes, Menon is confident that Atoga's platform will be ready for commercial use by the second half of next year.

"[The downturn] has only delayed the installation of our systems until the next quarter," he said. "We have spent months working alongside vendors to test tunable-laser characteristics and our results have shown them to be robust."

Tunable lasers are also likely to be used in packet switching and they could lead the way to the development of all-optical networks. Microelectromechanical systems (MEMS), which switch wavelengths from one fibre to the next, are already emerging. However, if widely tunable lasers are added to MEMS, switching will be feasible from any wavelength to any other.In practice, today's tunable lasers are only capable of millisecond switching speeds, rather than the nanosecond speeds that are required for packet switching. According to Patel, packet switching is at an embryonic stage and will not be practical until at least 2005. Despite immature technology, however, US-based start-ups such as Atoga, Caspian Networks and Village Networks are ready and waiting to incorporate tunable lasers with nanosecond switching speeds into their DWDM platforms.

High prices and slow switching speeds are not the only hurdles that tunable-laser developers must overcome. In many tunable-laser technologies maintaining wavelength stability is difficult, although many firms, including Alcatel, Lucent and Nortel, have already integrated wavelength lockers into their tunable sources.

Service providers are also concerned about power issues surrounding tunable lasers. "Current power levels are fine for metropolitan communications, but not for long haul," said Patel. "We could have tunable lasers in long-haul markets by next year, but that is optimistic."

Both Buus and Patel agree that standardization between different laser technologies is not a problem, although Buus emphasizes that control and reliability need some work. However, he added: "These issues are resolvable - it is just a matter of time. There is nothing that is intrinsically impossible."

US firm ADC, which took over Swedish company Altitun in May 2000, believes that its grating-coupled sampled-reflector (GCSR) lasers are the answer.

These lasers were first commercialized by Altitun, which combined a widely tunable co-directional coupler with a sampled grating to give a laser with wide tuning and a good spectral selectivity. When ADC bought Altitun to form ADC Photonics, ADC's senior vice-president cited the GCSR laser as a pioneering technology with the widest tuning range commercially available.

Björn Broberg, director of engineering at ADC Photonics agrees. "Historically we have tried [two other] tunable lasing technologies," he said. "We found that the GCSR design had a power advantage, and that the power was uniform over the tuning range." In addition, Broberg says that the technology is robust and easy to control, with a comparable processing and chip cost to other tunable sources. ADC believes that its tunable-laser product has been able to achieve nanosecond switching speeds that are fast enough for packet switching.

Another tunable-laser technology that looks set to take a key role in the market is based on vertical-cavity surface-emitting lasers (VCSELs). VCSELs can be converted into tunable lasers by suspending a top reflector over the active region that electrostatically deflects to form a small cavity. Tuning ranges are typically between 30 and 50 nm, and the power output is limited.

Both Bandwidth9 and Nortel Networks are developing VCSEL-based tunable lasers. Having bought CoreTek in the US, Nortel expects to launch its VCSEL technology by the end of this year.So which of the tunable lasers will turn out to be the killer technology? Buus suggests that there will be no clear leader because the market is fragmented into different application groups. Patel also believes that technologies will be split by applications but is taking a more competitive stance.

"For long-haul networks, external-cavity lasers will lead because of their high power, whereas distributed Bragg reflector lasers and VCSELs have low power, which is more suitable for the metro market," he predicted. However, he adds: "Cost will be an issue, so in the long term, VCSELs could lead." Tunable lasers can be tuned thermally, electronically or mechanically. Thermal tuning alters the refractive index of the laser's active region and the wavelength of light emitted. It is a simple but slow technique with a practical tuning range of a few nanometres at best.

Distributed-feedback (DFB) lasers are based on thermal tuning. As well as having narrow tuning ranges and slow switching speeds, these lasers also have a low output power. Distributed Bragg reflector (DBR) lasers, based on simple DFBs, can be either thermally or electronically tuned and, unlike their predecessors, have the potential to reach nanosecond tuning speeds.

US-based Agility has taken DBR technology one step further to produce thermally tuned sampled-grating DBR lasers. Meanwhile, Marconi Optical Components of the UK is also working on advanced DBRs and has just announced its digital supermode indium phosphide DBR laser. The laser has a minimum tuning range of 35 nm and Marconi hopes to make volume shipments by mid-2002.

Mechanically tuned lasers include external-cavity lasers (ECLs) and vertical-cavity surface-emitting lasers (VCSELs), which typically use MEMS to switch wavelengths.

ECLs contain an external grating that acts as a reflector. By rotating the grating, continuous wide tuning up to theoretical values of 240 nm is possible. Key ECL developers include US-based New Focus, Blue Sky Research and Iolon, which has just developed an ECL that is tuned with silicon MEMS.

Researchers at Iolon say that by using MEMS they can reduce the device size to a small robust package suitable for use in optical networks. Their ECL offers wide 38 nm tuning ranges and high power outputs suitable for telecoms.