Market Update
For the past few months module makers appear to have spent most of their time trying to prove that they can force 10GigE prices ever lower and that XFP is the MSA that will be the shape of things to come for 10-Gbps modules. A couple of years back it looked as if XENPAK would be the winner, but now XFP seems likely to undershoot XENPAK in pricing pretty soon, if this is not already happening. The not so surprising result is that equipment vendors?with increasing frequency?are picking XFP over XENPAK for their next-gen routers and other products. By the end of next year, or perhaps in early 2006, we would expect the bulk of 10 GigE interfaces shipped to be XFP. The other MSAs are going to stay around for a while, because in the current climate, no equipment vendor is going to redesign its equipment just to give them XFP modules.
The rise of XFP is, we believe, good news for the industry in that too many MSAs in what is still a relatively low volume market, makes little economic sense. However, the fall in price for XFP should not been seen as an entirely good thing?we suspect that a lot of it has to do with cutthroat competition. Virtually every module maker?large and small?is in the XFP space now and, as we just noted, volumes are just not that high. XFP vendors include: Agilent, Avanex, Bookham, Finisar, Intel, JDS, OpNext, Sumitomo, Triquint and Tyco; plus some smaller firms.
One clue to the fact that price reductions may have as much to do with "oversupply" as it does towards the emergence of a mass market is that much of the original focus for XFP was for storage applications. While SANs continue to be a decent growth area, the 4-Gbps Fibre Channel standard has stolen some of the thunder from the 8/10 Gbps FC, which many XFP vendors thought would be their mainstay. XFP modules are small though and real estate savings remain an attractive feature for both the equipment vendors and their customers. The equipment vendors will have to buy an extra SERDES chip when using XPAK, but if XPAK prices drop far enough that will hardly matter.
In a related development, the success of XPAK has begat an XPAK TOSA/ROSA MSA, which has gathered the support of Avanex, Eudyna, Mitsubishi, Oki, Opnext, Sumitomo and TriQuint. This should help standardize the optics inside the module. This further standardization-which may also influence the optical components used in non-XPAK modules-should lower costs and help profitability for module makers a bit, but will push competition even further away from technology and product and towards supply chain issues.
The shift toward XFP is occurring much faster in the datacom space than in the telecom space. This is partly because telcos and their suppliers are a little more technologically cautious and also because longer-range XFP modules are not widely available yet. In addition, it is not yet clear how tunable modules will meet the XFP format. The bottom line is that all sectors will ultimately convert to XPAK, but it will probably not be until 2006 that the market becomes dominated by XPAK.
Table of Contents
- 1.0 Market Update
- 2.0 Agilent
- 3.0 Avanex
- 4.0 Bookham
- 5.0 Finisar
- 6.0 JDS Uniphase
- 7.0 OCPI
- 8.0 Opnext
- 9.0 TriQuint
