Showing signs of life?

According to figures just released, the U.S. economy grew at an annualized rate of 7.2% in the third quarter of 2003—an increase in gross domestic product (GDP) greater than any since the first quarter of 1984 and the broadest-based gain in the economy in three years. Although spending by consumers, exports, and U.S. residential construction all increased, perhaps the most significant part of the news was that investment by businesses grew at 11% (annualized)—the fastest rate since early 2000. And while the GDP growth rate will not be sustained (according to the same economists who were in fact surprised by this third-quarter growth number), it would certainly appear to be a harbinger of good news for those of us looking for recovery in the high-technology sector.

Nonetheless, the signs are a bit confusing. Many recent interviews conducted while preparing for our Annual Market Review and Forecast (to be published next month) suggest that there are real signs of life in the optoelectronics marketplace and many firms are optimistic about the latter half of 2004. Unfortunately though, some sectors are still dragging. The semiconductor capital equipment book-to-bill ratio, for example, has remained stubbornly below one since August 2002.

Underlying the commercial markets, however, the foundation of optoelectronics and photonics technologies remains robust. In his annual technology review, senior editor John Wallace highlights many of these technologies, from single-atom lasers to novel displays. He also opines that it is a mix of invention and steady improvement thats needed to keep the field moving briskly (see p. 93). Wallace is talking technology, but lets hope this brisk pace carries over into the commercial marketplace during 2004.

Nonlinear optics is the basis of many current photonic devices including several of the new lasers mentioned in Wallaces article. Our Back to Basics series about nonlinear optics ends this month with a look at optical bistability and phase conjugation (see p. 64). New types of lasers are also making inroads into the field of confocal microscopy (see p. 67), which is being used to image live-cell fluorescence at the University of California (San Francisco, CA; see p. 94). Meanwhile, a different type of laser-based imaging has recently revealed new details of carvings dating back to around 1800 B.C.—a sure sign of very early life at Stonehenge in England (see p. 15 and cover).