ADC cost cutting efforts include layoffs, closing facilities

ADC Telecommunications today provided an update to its cost cutting measures, which include a discontinued product line and two shuttered facilities.

The company said it has completed its exit of the photonics market, which was announced last August. As part of the move, the company sold its Canberra, Australia photonics plant to Verrillon, a Massachusetts-based provider of specialty optical fiber and fiber-based solutions for optical component and modules. The plant manufactures passive optical components, such as couplers and WDM components, and about 55 ADC employees will transfer to Verrillon because of the sale. Terms of the deal were not announced.

Also as part of its photonics market exit, ADC has ceased operations in it Vadnais Heights, Minn. and Jarfalla, Sweden facilities. About 72 people are being transferred are or let go because of the elimination of the Vadnais Heights facility, which developed and manufactured pump lasers and micro optical products. The Sweden facility, which developed tunable lasers, will see about 145 layoffs.

ADC also said it is halting all development, marketing and sales activity for its Intelligent Access Network broadband gateway platform, dubbed iAN. The platform was aimed at U.S. carriers’ efforts to use existing copper plant in the transition of voice networks to broadband. ADC is not permanently giving up on this market, however. The company plans to retain all intellectual property rights to the platform and will monitor the market for a possible reentry.

“U.S. carriers, in our view, strategically know they’ve got to go in the direction [of voice to broadband networks], but with cap-ex constraints they’re not looking to go there now,” said a spokesman for ADC. “We think they’ll come back to this.”

As part of this decision the company will eliminate 100 positions.

Despite the discontinuation of iAN, however, the company reiterated its commitment to the BroadAccess platform, the international version of iAN.

“Internationally, there’s more of an opportunity to go straight to this platform as [carriers] are doing builds,” the spokesman said. “There’s not as much financial pressure as there is in the U.S. today and there’s also different regulatory environment.”