Corning bolsters component manufacturing

(Telephony) After last week’s burst of activity in the optical component space, things don’t seem to be letting up this week. Yesterday, Corning revealed it will spend $150 million to expand its Corning Optical Technologies Italia (Corning OTI) operations acquired from Pirelli last year.

Last week, Nortel moved to acquire JDS Uniphase’s Zurich facilities for $3 billion, which gave JDS Uniphase the freedom to merge with SDL.

Similar to Nortel’s acquisition, which will give the company more strength in 980nm pump lasers, the Corning investment also targets pump lasers. The company intends to use the investment to increase capacity in lithium niobate modulators, pump lasers, specialty fibers and fiber gratings.

The added strength in the 980nm pump lasers may be a wise bet for Corning. If Nortel’s acquisition of the JDS Uniphase unit goes through, the market will be still be left with only two main suppliers of the 980nm pump lasers. And to make matters more questionable, equipment developers could be relying on one of their own competitors for the critical supply of the parts.

Corning currently has about 11% of the component market as a whole, according to John Lively, director of optical components for RHK. And according to Lively, JDS Uniphase had about 40% of the 980nm pump laser market, which would shift in Nortel’s direction.

“Nortel may want to shift some of the output more toward their own facilities,” Lively said.

With the investment, Corning hopes to increase its prowess in 980nm pump lasers for submarine use, complementing its existing terrestrial 980nm pump competencies.