Review and forecast of the laser markets Part I: Nondiode lasers

THE LASER MARKETPLACE 2001—PART I: nondiode lasers

Stephen G. Anderson,Associate Publisher/Editor in Chief

The Laser Focus World 2001 Annual Review and Forecast of the Laser Marketplace is conducted in conjunction with Strategies Unlimited, an optoelectronics market research firm based in Mountain View, CA. Part I of the review reports on the overall market and focuses on nondiode laser markets. Part II, written by Robert Steele of Strategies Unlimited, covers the diode laser marketplace and will be published next month—Ed.

It will come as no surprise to anyone that—in the marketplace for lasers and optoelectronics—telecommunications has once again grabbed the limelight this year. But it may come as a surprise to actually see the numbers. Almost single handedly, the use of diode lasers in wavelength-division multiplexing (WDM) and elsewhere in telecom has driven the world's laser markets to astonishing new heights and has outstripped almost all related market projections. Last year we forecasted a total market size (all lasers) of $6.3 billion for the year 2000, of which diode lasers represented 69% or $4.3 billion. Telecom lasers accounted for $2.9 billion of this or 46% of the total.

This year, we have revised the size of the 2000 total market upwards to $8.8 billion, based primarily on an updated telecom market estimate of $5.1 billion for 2000—an amazing 132% jump over 1999's market of $2.2 billion. This means that the overall laser market (all lasers) in 2000 grew by 79% compared to 1999. Looking forward, for 2001 the revenue gains are only a little less staggering. We expect the overall market to gain another 30% reaching $11.5 billion. Underlying this total is a gain of 13% for nondiode lasers, while diode lasers for telecom and optical data storage are up 37% and 32% respectively. Numbers like these suggest all is going very well in the world's laser markets, but there are hints of unease in the market. The concern is centered on the overall economic outlook, which may be losing some of its luster, with a consequent potential downward effect on the rate of the optoelectronics market growth.

Nonetheless, the impact of the astronomical revenue gains on an industry that was once a relative unknown in the annals of the world's high profile financial markets are profound. Less than a decade ago, for example, venture-funded laser-based startups were rare and generally not perceived as a good investment. Now, though, by some accounts, venture capitalists are lining up to fund companies to develop new lasers and optoelectronics components targeted initially at the WDM business.

Novalux (Sunnyvale, CA), for example, recently closed its third-round funding of $109 million. Although the company sports an impressive list of investors, it has yet to market—or even publicly demonstrate—its laser (see Optoelectronics Report, Oct. 15, 2000). Another Silicon Valley startup, Bandwidth9 (Fremont, CA) makes a tunable vertical-cavity surface-emitting laser for WDM and also closed an $80-million round of equity financing. This trend is not limited to the United States. Oxford Lasers (Abingdon, England) has also raised about $5 million in venture funding to help increase production of its frequency-doubled copper-vapor laser used in the production of fiber Bragg gratings for telecom applications.

Meanwhile, new optoelectronics companies are sprouting up all over Silicon Valley and elsewhere in order to take full advantage of the current funding climate (see Laser Focus World, October 2000, p. 67). And the allure of fiberoptic communications is apparently irresistible, even to the traditional "old-line" optoelectronics firms (which are jumping on the bandwagon by repositioning themselves to take full advantage of financial markets) that are eager to invest in "anything telecom." Hence, Coherent (Santa Clara, CA) has seen its market capitalization jump by almost 95% between October 1999 and October 2000, while Newport (Irvine, CA) has gained more than 2000% in the same period. Other firms are abandoning some traditional markets, perceived as low-volume and high-maintenance (that is, low-margin), in the interests of a stronger focus on certain core competencies and probably a recognition that successfully mining the telecom opportunity requires a significant resource. SDL (San Jose, CA), for example, announced its intention to move away from several of its classic niche markets, such as visible devices.

Of course, the intense interest from Wall Street is both good news and bad news for those companies accustomed to a smaller, slower world dominated by technology. New investors have bid company valuations to giddy new heights, but stocks can plunge with gut-wrenching speed when Wall Street grows uneasy.

The "other" lasers
So, while the world's attention is focused on optical communications, what's happening in the "other" laser marketplace? Revenues for all lasers aside from telecom were revised upward for 2000 by about 18% to $3.8 billion, which represents a gain of roughly 44% over 1999. For 2001, these revenues are expected to increase a further 21% to reach $4.6 billion.

For nondiode lasers only, 2000 brought a revised revenue total of $2.2 billion, an adjustment upwards of 14%, and an increase of 26% compared to 1999. For 2001 this number is expected to rise 13% to reach $2.5 billion.

The message here is that although the optical communications market—at 57% of 2000 revenues—is initially overwhelming, a look behind the telecom revenues shows that most other markets are doing well, too—at least by traditional benchmarks.

So the world market for semiconductor devices, for instance, is expected to gain 37% in 2000 compared to 1999 and to grow another 27% in 2001, according to market research firm Dataquest (San Jose, CA). The related semiconductor-equipment sector is a major application for lasers.

In the industrial sector, the new millennium will mark a significant milestone for the laser business, says David Belforte, editor of Industrial Laser Solutions. For the first time, he explains, the systems sector will surpass the $3 billion sales mark and industrial-laser sales will exceed $1 billion. In the medical market, notes Medical Laser Report consulting editor Kathy Kincade, 2000 was another solid year. Its worldwide revenues grew from $1.9 billion in 1999 to an estimated $2.3 billion in 2000, and are expected to increase to more than $2.5 billion in 2001.

Nondiode-laser sales data for 2000 and 2001 are charted in detail by application and laser type in

Figures 1 and 2 respectively. Total worldwide commercial-laser revenues for 1997 to 2001 are charted in Figure 3. Tables 1 and 2 provide nondiode-laser sales data by unit shipments and dollar revenues respectively. The corresponding charts and tables for diode lasers will appear next month. See also "Where the numbers come from" on page 96. Readers also should note that sales of fiber lasers and metal-vapor lasers are included in the "other" laser category, but we are unable to publish any applications-specific data for this category.

The data presented in the tables are available with more detailed commentary in the January 1 issue of Optoelectronics Report. The survey data also will be analyzed at the 15th annual Laser and Optoelectronics Marketplace Seminar on Jan. 22, held in conjunction with Photonics West (San Jose, CA) and sponsored by Laser Focus World in conjunction with Strategies Unlimited. (See www.marketplaceseminar.com).

Global economics tinged with uncertainty
A more general look at the economies underlying the laser markets provides a rather mixed picture. For most of 2000 the US economy remained outwardly healthy and continued along the roughly 4%-per-year growth curve of the past few years. The Federal Reserve under Alan Greenspan's leadership held inflation in check, unemployment was near a 30-year low, and interest rates, although raised slightly during the year, were fairly stable. In March, the US Nasdaq Composite Index, which is heavily weighted with technology stocks, hit an all-time high and remained up compared to the previous year until early November.

More recently, there are indications that the economic picture could be changing and many observers are wondering out loud how much longer the outlook will remain sunny. Since last January the Dow Jones Industrial Average fell 10%, and the Nasdaq Composite Index plunged by more than 44% since its March high. For the Dow, that is the second steepest slip since the start of the 1990s, and the worst decline the Nasdaq Composite Index has recorded in the last 20 years, including the stock market collapse of 1987. At the same time, stock analysts are rushing to cut earnings projections of key technology firms as other indications of a slowing economy emerge (see The Wall Street Journal, Nov. 14, 2000; p. C1).

Meanwhile. US consumer confidence rended irregularly downward all year, and crude oil prices were up some 25% since the beginning of 2000, which limits disposable income while also fueling inflationary pressures.

In the technology sector, a major factor that could ultimately affect long-term company-growth prospects is people. Finding and keeping engineers and other skilled professionals has become a high-level problem mentioned by all the firms that responded to our survey.

On the international scene, the world's economies are so tightly linked that if the United States slows, so will Japan and Europe. In Japan the economic recovery appears still to be on track, if somewhat slower than many would like. The Bank of Japan recently projected growth of around 2% for 2000, but much if not all of that is from growth in exports not domestic. Last April the stock market in Japan was up by almost 60% compared to 18 months previously. However, by November the Nikkei 225 index had fallen to its lowest level since 1999, highlighting concerns not only about a Middle East war, high oil prices, and the outlook for the US economy, but also that the recovery in Japan is still fragile and another recession is at least a possibility.

The issues are similar throughout Europe. Retail sales are relatively sluggish, and the higher oil prices, exacerbated by punishing taxation, have slowed new auto sales and added to inflationary pressures. The Euro, too, is putting pressure on the system—almost two years old, the single currency hit a new low against the US dollar in October at about 30% below the rate at which it was launched. Although exports have benefited, it weakens the overall European economy with upward price pressure. Nonethless, it isn't price data that's the focus of attention in Europe, says John Tilston of Dow Jones Newswires who notes that the flow-on impact of high oil prices has so far been relatively well-contained.

The key issue going forward, says Tilston, will be whether investment to boost production capacity continues. Oil prices have slowed domestic demand, but order books are full and inventories low enough to keep production running at high levels for some time.

Materials processing
Last year, the semiconductor-equipment industry was the primary culprit of the lackluster 4% growth of the overall materials-processing sector between 1998 and 1999. For 2000 we had projected a semiconductor revenue growth of 12%, with a gain of 16% for all materials processing. As it turns out, the semiconductor industry grew faster than anticipated. ASM Lithography (Veldhoven, The Netherlands), for example, reported shipment of 169 wafer steppers for the first six months of 2000, up from 80 units in the same period of 1999. On our survey, the semiconductor-and microelectronics-processing market sector ended the year with sales up 41% from 1999. Much of this increase was due to higher excimer-laser revenues, which in turn resulted from a small unit-sales adjustment and average pricing adjustments incorporated because of gradually improving market information. A reduced total-unit count for this sector in 2000 is due to a combination of accumulated restatements and the reallocation of some helium-neon (HeNe) lasers.

The upbeat outlook continues into 2001 with a forecast of 30% growth for semiconductor-processing revenues—primarily excimer lasers for lithography. Market leader Cymer (San Diego, CA) is predicting its lithography-related revenues for 2000 will be up between 65% and 68% over 1999, and that it will grow revenues a further 35% to 40% in 2001. Nonetheless, in its third-quarter earnings report, the company also points to indications that chipmaker spending on new equipment and factory-capacity expansions in 2001 will be lower than it originally forecasted, but still significantly in excess of such spending in 2000. The market drivers continue to be the transitions to 150- and 130-nm patterning, as well as 300-mm wafer substrates, and the use of copper for the conductive layer in chips (for an update on microlithography, see Laser Focus World, December 2000, p. S5).

Other active markets in the materials-processing sector include the manufacture of fiber Bragg gratings and marking. Fiber Bragg gratings are used in optical communications so demand is high. Three types of lasers can be used to produce them; excimer lasers, copper vapor lasers, and frequency-doubled argon-ion lasers and sales of each have benefited. Product marking and coding remains one of the hottest of laser applications in this sector, says Belforte, with more than 50 companies, worldwide, claiming to offer systems for this market.

In the metal-processing market, overall sales for 2000 were adjusted downward about 5%, which means revenues gained 10% compared to 1999. For 2001 a gain of 11% is forecasted. According to Belforte, the global nature of this market helped to equalize softness in North America, where the annual growth rate dipped below 10% as the beginnings of a slow-down in the manufacturing sector became apparent in the fourth quarter. However, continuing strength in Europe and a return to growth among Japanese suppliers acted to offset this aberration.

A gain of 17% overall is forecasted for 2001, with nondiode-laser materials-processing revenues reaching $1.6 billion. Belforte notes that laser materials-processing applications continue to grow as more companies experience the cost benefits of highly productive laser operations. Also, survey respondents commented on the importance of customer education to continued growth in these markets.

In Europe, Arnold Meyer of Optech Consulting (Taegerwilen, Switzerland) cites the revenues of leading suppliers as indicative of the healthy state of the European business. Trumpf (Ditzingen, Germany) reported a 15% increase in sales to Euro 1 billion ($850 million) for its fiscal 99/00, of which 61% is due to laser-related products. Rofin Sinar reported a 60% increase in sales for the second quarter of 2000 (32% of which was due to the acquisition of Baasel Lasertech; see Laser Focus World, December 2000, p. 55). That company is also benefiting from a gradually increasing installed base of diode-pumped multikilowatt lasers as these lasers gain ground in the European automotive industry. Also, the weakening Euro means that European-based firms can be more price-competitive in many cases than their US-based competition.

Medical therapy
Revenues from lasers sold for medical therapy jumped 44% between 1999 and 2000, based on restated 2000 sales of $629 million. Much of this gain is based on average-selling-price adjustments, however; unit sales for the same period gained about 6%. For 2001, sales are expected to increase by 7% to $670 million.

Cosmetic applications, primarily hair removal and vision correction, are driving this growth, says Kincade. Sales of surgical-laser systems (which include hair removal) grew from $707 million in 1999 to an estimated $810 million in 2000, while sales of ophthalmic lasers have nearly doubled in the past two years, from $340 million in 1998 to an estimated $600 million in 2000.

Diode lasers underlay much of this growth. Sales of diode-laser systems for ophthalmic applications (primarily for the treatment of age-related macular degeneration, or AMD) have doubled since 1998—$24 million in 1998 to an estimated $48 million in 2000. For nondiode lasers, excimer sales were adjusted upward by 20% (units) in 2000, producing a unit increase from 1999 to 2000 of 17%, with another 18% unit gain projected for 2001, with revenues up 10% reaching $230 million. The bulk of these sales are for vision-correction systems, but surgical applications of excimer lasers include angioplasty, transmyocardial revascularization (TMR), and the treatment of psoriasis.

Aside from vision correction and hair removal, therapeutic and diagnostic applications are beginning to shift the general revenue stream away from surgical lasers. While this is having a negative impact on sales of CO₂ and Nd:YAG lasers—sales of CO₂ lasers, for example, were flat into 2000 and will drop about 12% in 2001—it represents another growth area for diode lasers. In fact, sales of diagnostic devices, the bulk of which are based on diode lasers or LEDs, are also on the rise, although the growth rate in this category has slowed. Another application gaining ground and affecting both diode and nondiode lasers is photodynamic therapy (PDT), which is being approved for treating an increasing number of cancers as well as new markets such as AMD and psoriasis—related dye-laser sales are expected to gain 30% in 2001.

Elsewhere, Kincade points out that the average sales price (ASP) of holmium- and erbium-laser systems (considered a single category in our numbers) has jumped dramatically in the past year, due primarily to the commercial introduction of the Sunrise holmium laser, which received FDA clearance for laser thermal keratoplasty (a nonsurgical vision-correction procedure). That system sells for $225,000. Other treatments using these lasers include TMR and dentistry, both of which are expected to gain ground in the next few years.

Medical-laser market trends to watch in the next year include the expected first FDA clearance of a laser-based device for biostimulation; the increasing sophistication of excimer-laser-based vision correction; and more laser-based treatments for chronic skin problems, says Kincade. She also expects to see more "smart" medical devices that incorporate sensors, software, fiberoptics, diode lasers, LEDs, and other optoelectronic technologies to improve diagnostic, surgical, and patient-monitoring applications (see MedicalWatch, p. 83).

Readers should note that many medical-device manufacturers do not participate in our survey. To derive the laser source revenues reported here, we rely on help from Medical Laser Report contributing editor Irving J. Arons, who tracks medical-system end-user sales within this market sector. Revenue projections by Arons and Kincade are based on medical-system sales to medical end-users—the laser is only one component of these sales. The numbers in our tables, however, are based on revenue estimates of the laser source itself.

Basic research
An overall increase of 5% in laser revenues for basic research in 2000 compared to 1999 is slightly better than expected and is followed by a 6% gain into 2001. Nonetheless, a quick look at the nondiode-laser numbers highlights a trend occurring throughout the global laser markets—diode lasers are becoming increasingly important in all aspects of optoelectronics research and applications, often (as here) at the expense of nondiode lasers. Hence, while nondiode-laser revenues are essentially flat from 2000 through 2001, diode-laser sales will gain 54%.

As the optoelectronics markets continue to focus more on applied research and development rather than fundamental research, the performance of this market sector remains lackluster. Ion-laser sales are flat as diode-pumped solid-state (DPSS) lasers gradually push them aside. In 2000, sales of laser-pumped solid-state systems including tunable systems (optical parametric oscillators) gained 6% over 1999, but are then expected to remain essentially flat into 2001. The only nondiode lasers showing a significant gain into 2000 are DPSS devices, which will increase 14% (11% units) in 2001 after a 47% revenue gain in 2000 compared to 1999—part of this increase was due to a change in ASP, which moved up about 30%. The user-friendly nature of these devices (relatively low power-consumption and small size) compared to their ion-laser predecessors means they will likely continue to gain ground in the research markets, particularly for pumping larger research-oriented systems such as regenerative amplifiers.

Instrumentation
Last year's projected revenue increase of 12% (all lasers) for 2000 was right on target. The picture looks much brighter for 2001, with a healthy jump of 21% (5% units) forecasted, mostly in ion lasers and DPSS devices. Sales of argon-ion lasers are expected to gain about 20% ($3.6 million), which is counter to the general trend downward for these lasers. As with the helium-cadmium lasers (up 38% in 2001), argon-ion lasers are a relatively cheap source of low-power blue or ultraviolet light, which is particularly useful in certain biomedical applications. Meanwhile, DPSS systems are expected to grow 46% into 2001, reaching revenues of $7.5 million.

The use of lasers in bioanalytical instrumentation has burgeoned during the past year, according to Philip Greenfield, managing editor of Analytical Instrument Industry Report (Surrey, England; www.aiireport.com). Our numbers for bioanalytical instruments show a 23% revenue gain for 2000 over 1999, and a further growth of 25% for 2001, meaning that laser sales into this subsector reach $32 million (all lasers). Greenfield points to a couple of techniques with growth potential. Surface-enhanced laser desorption ionization (SELDI) is used in conjunction with mass spectrometry, and was developed at the Baylor College of Medicine (Houston, TX) and licensed commercially by Molecular Analytical Systems (Los Altos, CA). Its use is being pioneered by proteomics companies LumiCyte (Fremont, CA)—for protein-mapping discovery services and the generation of clinical databases—and Ciphergen Biosystems (Palo Alto, CA), for its ProteinChip systems and arrays.

Laser-induced fluorescence detection (LIF) has been available for some years but has yet to achieve strong sales.

Combined with high-resolution capillary electrophoresis, however, LIF is now being used by drug-discovery company Cetek (Marlborough, MA) to screen new genomic targets. And high-performance LIF detectors combined with chromatography are being used for analytical work in several life-science research areas, including neurosciences. A newer technique, laser capture microdissection, enables specific and rapid sampling of single cells or populations of specific cells on which molecular, genetic or proteomic analysis can later be performed.

Image recording
The use of lasers for directly imaging plates used in commercial printing presses (computer-to-plate or CTP) took another step forward last year, with various new systems being shown at DRUPA in Germany last May (see Laser Focus World August 2000, p. 38). Although currently only accounting for a small percentage of the total printing plates imaged each year, the development of CTP technology has benefited many other aspects of this market. Several laser technologies are involved, including DPSS systems—which are widely used in the thermal platemaking process—fiber lasers, which also are used with thermal plates, and diode lasers (see p. 195).

Visible-laser-based CTP is an alternative to the thermal process and uses plates with a different coating. In this case, although they are relatively expensive, frequency-doubled DPSS devices emitting at 532 nm are generally used. At DRUPA, systems based on a 410-nm blue/violet diode laser were shown. The use of this device is intriguing because it's the same laser that will be used in the next generation of high-density DVD systems—the resulting mass market will likely bring the price of the diodes down to make them very competitive.

A look at the numbers shows a 45% increase in laser-sales revenues between 1999 and 2000 for the commercial printing sector with another 8% growth expected for 2001 (all lasers). Much of the 45% jump is accounted for by DPSS lasers, which increased from $5 million in 1999 to $27 million in 2000; DPSS units gained 102%. Another 15% increase in sales of DPSS lasers is expected for 2001. Meanwhile, HeNe lasers, a one-time mainstay of this category, continue their decline, dropping from 20,000 units in 1999 to 9000 units in 2001. Desktop printing is the exclusive province of diode lasers, which account for about $19 million of sales in this sector and are expected to remain flat into 2001.

Sensing
This market traditionally has been mostly nondiode-laser-based and limited by the nature of the lasers required for remote sensing—often bulky, expensive, and not very user-friendly. So the market has struggled along from year to year, trending gradually downward. This year, however, saw a huge 55% jump in nondiode-laser revenues. The jump results from CO₂ lasers appearing in this category this year, and from an increase in the ASP of solid-state lamp-pumped devices used for sensing. Both of these appear to be artifacts of the survey and do not represent a fundamental change in the market. Even after those two adjustments are made, the trend is still downward. Diode-laser revenues, however, are expected to cross the $1 million mark in 2001, up 79% from 2000.

Inspection, Measurement, and Control
Although there is a wide variety of nondiode lasers that fall into this category, by its very nature most are low-power and represent easy targets for replacement by diode lasers. Hence, the revenue trend for nondiode lasers has been consistently downward for the past five years, with a 33% drop in 2000 and another 6% loss forecasted in 2001. Diode lasers, however, have made gains and 2001 should see an increase of 56% in related revenues, bringing diode-laser sales to more than $5 million in this category.

Entertainment and display
Nondiode lasers in this sector include DPSS devices, HeNe, and ion lasers. The lightshow market received a boost last year from the parties and events surrounding the eve of 2000, but the huge jump in DPSS lasers that marked last year's numbers is absent this year—sales of DPSS lasers were expected to reach almost $6 million in 2000, but actually came in at a paltry $1.25 million. Several factors may account for this disappointment. The euphoria surrounding the "New Millennium" was undoubtedly part of the picture, but there was also an expectation that diode-pumped microlasers would play a large part in building up the market, particularly at blue and green wavelengths. It will be interesting next year to see what happens.

The other mainstay laser for entertainment has been the ion laser—either krypton, argon, or mixed-gas systems. The services required by these lasers and their size have made them prime targets for replacement, so not surprisingly, the related overall revenues continue to decline. Revenues for ion lasers producing more than 1 W output will remain flat into 2001 at about $5 million. Sales of the low-power air-cooled devices though, are expected to drop about 5% in 2001.

Also expected to drop are sales of diode lasers, which give up about 6% into 2001. Most of these are visible devices sold in laser pointers

Optical data storage
Optical memories are spreading like wildfire—or so it seems sometimes—and consumers must digest a broad array of new acronyms as various new DVD formats emerge to complement the existing set of acronyms around CD-ROMs (see Laser Focus World, August 1999, p. 171). Hence this market is growing and is expected to gain 37% in 2001 compared to 2000—but it's all semiconductor-laser-based growth.

Nondiode-laser revenues in this market are down slightly from 1999 and will remain flat through 2001. Optical disc mastering is the primary commercial application, although some lasers are sold for experimental systems such as holographic storage, which is still a long way from commercialization (see Laser Focus World, December 2000, p. 123).

Telecommunications
Much has been said in this article about the state of the telecom market. The total laser revenues associated with telecommunications are expected to reach $6.9 billion in 2001, which represents almost 60% of the total laser revenues (all lasers) for that year. Despite last year's projection that nondiode-laser revenues in this market would remain at about $1 million, our survey came up with no numbers. This is likely more a testament to the relative sizes of the two markets than the reality. It seems probable that there are still some revenues flowing for DPSS lasers used in telecom, though not many. A detailed commentary on this sector will appear next month in Part II of this report.

Barcode scanning
Only one nondiode laser, the venerable HeNe, is used in this application and sales continue to dwindle as older scanners are replaced with smaller, newer devices based on diode lasers. Unit sales of HeNes fell in 2000 by more than 50% to 14,000 units and are projected to fall another 29% in 2001. This decline bears little relationship to the scanning market itself, however. Market leader Symbol Technologies (Holtsville, NY) announced third-quarter earnings 27% higher than the previous year and is optimistic about the current outlook. According to our survey, diode-laser sales are on a healthy upswing to reach $8.23 million in 2001, an increase of 17% compared to 2000.

Other applications
A surprise jump in nondiode revenues in this sector is due exclusively to DPSS lasers used in aerospace and military applications. In the overall sector, revenues from 1999 to 2000 increased by more than 200%, mostly due to the semiconductor lasers used in local-area networks. These jumped from $55 million in 1999 to $184 million in 2000 and are expected to gain another 52% in 2001.

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*To obtain back copies or subscription information about Optoelectronics Report, Medical Laser Report, Industrial Laser Review, or WDM Solutions or to purchase the tables on disk, contact Jayne Sears Renfer, 98 Spit Brook Road, Nashua, NH 03062-5737; 603-891-9416 or Fax 603-891-9350.

For information about attending the Laser and Optoelectronics Marketplace Seminar at Photonics West (San Jose, CA) on Jan. 22, call Sharon MacLeod at 603-891-9138 or visit www.marketplaceseminar.com.

More detailed information about the data presented here will be available at the 15th Annual Laser and Optoelectronics Marketplace Seminar on Jan. 22 in San Jose, CA. See www.marketplaceseminar.com for more information.

Readers interested in the detailed results of both surveys will find them in the Jan. 1 and Feb. 1 editions of the Optoelectronics Report newsletter, published by Laser Focus World. A more extensive review of the data, with supporting commentary from market analysts, will be available at the Laser and Optoelectronics Marketplace Seminar on Jan. 22, held in conjunction with Photonics West in San Jose, CA. See www.marketplaceseminar.com for more information or call Sharon MacLeod at 603-891-9224.

Collecting the data
We conducted our research and analysis for the Review and Forecast during October and November 2000. Laser manufacturers were contacted by email, fax, or phone and they responded with oral and written information, both qualitative and quantitative, about their markets, the business outlook, and their expectations for next year.

We asked these manufacturers to provide an estimate of total worldwide market size (dollars and units), by laser type, for the markets with which they are familiar. We requested this information for 2000, based on year-to-date actual data, and a forecast for 2001. We also asked respondents to comment on which applications or markets have the most potential for growth in 2001, the significant technology trends, and business or market trends. We also used data from other—more narrowly focused—market surveys, and we incorporated commentary provided by industry analysts. Quantitative information about the medical-laser marketplace was provided by Irv Arons, a contributing editor to Medical Laser Report. A global perspective was provided by our contributing editors throughout the world. Unless noted, the sources of information used in the survey, and the names of those who participated, are, and will remain, confidential.

Comparison with last year's numbers
Readers will note differences and occasional inconsistencies between last year's 2000 estimates and this year's restated 2000 numbers. In general, no attempt has been made to explain these differences. We request "bottom-up" market estimates, and the respondents to our survey do vary from year to year—both in terms of the companies and individuals—so variations in the results are inevitable. In addition, changes in market visibility occur as market shares change. Differences in the overall numbers for 2000 last year and for 2000 this year may also reflect whatever degree of optimism or pessimism was inherent in last year's forecast (see Laser Focus World, January 2000, p. 92).—SGA