How the mighty hath fallen

Much has been made of the potential for optical technologies to provide high-bandwidth communications all the way to the home, with some observers suggesting that fiberoptics would gradually replace copper to the point that all-optical networking eventually banished copper to the optoelectronic history books. Such forecasts, combined with others like those suggesting that Internet traffic was doubling every three months, were the root cause of the "bubble" in 2000 that pushed telecom to the forefront of optoelectronic applications. Two years ago the Laser Focus World annual market review sized the market for telecom diode lasers at $5 billion for 2000. This year, however, the corresponding number is $665 million for 2002—sales have fallen by 87% and telecom has lost its place as the number one application for lasers based on revenues.

Optical data storage, meanwhile, has been steadily making inroads into various consumer markets. The widespread acceptance of the DVD format during the last year has propelled sales of lasers for optical storage to $1.4 billion—an 82% jump over 2001—thereby displacing telecom and firmly establishing this as the current number one application for lasers (for more information about all the diode-laser markets see p. 63). A longstanding goal in the optical-storage arena has been to find a viable holography-based technology for next-generation data-storage systems. Holographic storage promises very high data density combined with high-speed search and retrieval. Our cover shows a new CD-sized holographic storage disk that is reportedly ready for the commercial marketplace. It holds about a terabit of information—more than a thousand times that of a CD (see p. 17).

Another large but dispersed segment of the overall laser market is the application of lasers to making integrated circuits. As chip makers begin to test the physical limits of Moore's Law, existing lithography systems based on excimer lasers will need replacing with next-generation systems based on extreme-ultraviolet sources (shorter wavelengths produce smaller features). Development of sources at the correct wavelength with sufficient intensity is one of the most critical aspects of this change (see p. 55 and p. 24), which also involves the use of novel optical elements (see p. 34). Such innovation, according to Andy Grove of chipmaker Intel, is key to coming out of a downturn on the upside—and presumably to making sure that his particular mighty giant does not fall.