NFOEC 2002 Presents the Good, the Bad and the Ugly

Hank Hogan

Like the hackneyed joke, the National Fiber Optic Engineers Conference (NFOEC), which took place in Dallas in mid-September, presented some good news and some bad news. On the plus side were signs that 40-Gb/s fiber optics technology and other solutions were ready to roll. On the negative side were indications that the industry continues to face deepening -- and perhaps fundamental --problems.

In the good news category, companies including Tektronix Inc., PerkinElmer Inc., Agilent Technologies Inc. and Exfo released new optical test equipment at the show, some specifically designed for 40-Gb/s networks and components. Other solutions on display included an automated fiber optic inspection system built by PVI Systems Inc. using a National Instruments Corp. platform.

Another positive item came from the Telecommunications Industry Association, which presented a white paper indicating that some city-to-city links were near capacity. The assertion was that carriers soon would have to add or light more routes.

The bad news was that many problems clearly remain in the fiber optics business. Traffic at the show was light, and there were more than a few empty booths. W.L. Gore & Associates Inc. announced that it was getting out of the fiber optics business and was entertaining offers at the show.

Also, at a well-attended presentation about the prospects for recovery, market pundits asserted that telecommunications carriers' capital expenditures need to be in the 10 to 15 percent range in the long run. This contrasts with the 20 percent or more that wireless companies currently are spending. Therefore capital spending will continue to decline, with projections of at least a 5 percent drop over the next year. There is also the chance that expenditures will fall even further, as there are signs of a structural change in telecommunications.

It is unclear who'll be the butt of this particular good news/bad news joke. At the moment, nobody is laughing.