Member News - May 2016

Industry Member News

16 May, 2016


OSA Corporate Member Newsletter
 
In this Issue:

Takeaways from the Biophotonics Town Hall Forum in Florida
OIDA held its 2nd town hall forum on the commercialization of biophotonics; the takeaways were more nuanced compared to the first OIDA town hall held last October. The forum was held at the OSA BIOMED Congress, in Fort Lauderdale, Florida on April 29.

The town hall addressed the challenges and opportunities in commercializing biophotonics, itself a worldwide market of about $54 billion annually. The takeaways fall into four categories, listed below.
  • Technologies. There are technology priorities, but it's not useful to speak of "gaps", because there is always another way to do things. Gaps are usually evident only in retrospect, after the hard work of commercialization is done and you can't imagine how you got by without it. There are hot technologies, though. One is photoacoustic imaging. It was the topic for several start-up company presentations at a pitch panel session earlier in the day.
  • Markets. One can look for large markets or small up-and-coming markets, but there is a third option: using "health economic analysis." It's a buzzword that means looking for the pain points in health care system costs from the point of view of the providers and payers, especially the payers. If a product reduces cost for the payer, there will be a quicker path to adoption. And one can learn a lot about how the end-users use tools by getting out of the lab and "hanging out with the MDs."
  • Regulatory agencies. There are those who believe that the regulatory agencies, such as the U.S. Food and Drug Administration, are slow, uninspired, and capricious. But others said that the FDA process is reasonable for those who make the effort to understand it. Hiring an experienced consultant is necessary to navigate the nuances of the process. And, the regulatory process is nonetheless easier than getting approval for insurance reimbursement.
  • Financing. Large life science companies and private venture funds look for start-ups to finance. And there are SBIR grants in the U.S. from various offices within the National Institutes of Health. But finding financing remains very much an art, not a science, making it baffling and frustrating to those seeking funding. Yet, Scott Coleridge from Morningside Technology Advisory offered hope, saying that there is always money for good ideas. Eric Swanson added that much of the low hanging fruit has already been picked, but the opportunity for impact to global health has never been so great as now.
 
The figure shows U.S. venture financing in the categories of biotechnology and medical devices and equipment. Investment has been generally upward, with some surges around 2000, 2007, and 2015. The share of spending on these categories actually declined in 1999-2000 and recently, because so much more venture investment went into other sectors in those years, particularly software. Venture investors are often too impatient to fund products that require a long regulatory process, and unregulated products (such as personal health sensors) have been attractive lately, for that reason.

OIDA will issue a roadmap report on this topic later this year. For questions, contact Tom Hausken.
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Facebook's 21st Century Headquarters and What it Means to Photonics
Facebook hosted another OSA committee meeting at Facebook's new headquarters in Menlo Park, California, and it provided a window into the future of work.

The building at first appears unfinished. The reception desk is made of unfinished plywood. In fact, unfinished plywood appears in a lot of places, and there was even a space marked off by bare studs, no sheet rock.Steel I-beams are bare, with the factory marks still on them. This is intentional, to indicate that "nothing is finished", your work is forever a work in progress. There are no white boards—you just write on the walls and wipe it off. There is art everywhere, but not the framed kind, under glass. It's integrated into the surroundings.

A model of the building showing the spaces within
the large boxy open-plan design.
The building was designed by Frank Gehry and is the largest open plan office in the world. It is essentially a community of spaces within a large, boxy warehouse-style room. There are glass-walled meeting rooms, small "phone booths" if you need privacy, other spaces that are more like living rooms, as well as groups of workspaces much like sets of drafting tables. The meeting rooms have unusual names, like the "Chewing With Your Mouth Open Meeting Room." The roof is an open park with an unobstructed 360-degree view of the coastal range to the west and the bay wetlands to the east at low tide. All the food in the restaurants is free, as are healthy and unhealthy snacks, all the espressos you want, and in-house laundry, 24-hour pizza delivery. You never have to leave.

The building design grows on you. What seems confusing and unfinished at first, seems stimulating, coherent and purposeful over time. It really does force you to "think different," to borrow Apple's catch phrase.

How does this relate to optics and photonics? Companies like Facebook, Google, Microsoft, Amazon, Apple, and Amazon each have multiple data centers the size of huge warehouses. Each data center is filled with hundreds of thousands of server boards, each connected to a network, much of that network using optics. Microsoft said (at an OIDA workshop no less) that it clears out each data center down to the floor every 3 years and installs all new equipment, just to keep up. That's the equivalent of replacing your laptop every 3 years, except that each data center costs $200 million and up to renovate. Last year, Facebook alone spent $2.5 billion on new equipment. A good percentage of that is optics.

This stuff is driving the optical communications industry right now. So yes, Facebook and its siblings matter a lot to our industry. Many of the workplace practices at FB headquarters are not new, but the Frightful Five seem to be stepping things up: Apple is completing its new ring-shaped headquarters in Cupertino, and Google plans a tent-like headquarters in Mountain View. And they're hiring photonics engineers.
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The Photonics Grass is Greener, or is It?
OIDA has reported in the past on the regional photonics markets, and our view is that the U.S. photonics industry is slightly larger than the European photonics industry. They are as alike as fraternal twins, in size and diversification. But the U.S. is stronger in photonics in military, communications, and life science segments, even if Europe is stronger in machine tools and lighting.

Yet, OIDA finds that many in the U.S. mistakenly believe that the U.S. is behind Europe in photonics. Europe does have a good brand: there is a European Commission unit dedicated to funding photonics that has no parallel in the U.S. That funding is only €100 million per year, however; non-military funding from all the European Union governments combined is estimated at €500 million. Including non-E.U. governments and military photonics brings the value closer to €1 billion. Compare that to the total U.S. government funding of photonics of at least $1.3 billion, as estimated by OIDA.

The shortcomings in Europe are easy to identify. OIDA attended the annual meetings of Photonics21 and EPIC this spring, in Brussels and Zurich respectively. Common concerns are the labor laws and the lack of a path for small companies to scale up. Europe is home to many small companies, but they remain stuck small. And not necessarily because they want to remain "mom-and-pop" cottage businesses, but because the ecosystem doesn't support them to scale. Many companies feel that they have to have a presence in the U.S. to expand. Venture financing is available, but at a much smaller scale, and there is stronger aversion to risk in the culture overall. And about that European Commission funding: there's a lot of paperwork and a low acceptance rate.
As for Asia, things are not looking so good there. China's tech sector is still doing well, even as other sectors are facing troubles. Its photonics sector has more promise than in most other regions, although it has been prone to swings of overinvestment in factory capacity (such as in LEDs and solar cells). After China, though, it's worse. Korea's industry is tethered to the fates of LG and Samsung. Japan's photonics industry is seeing the kind of offshoring that the U.S. experienced in photonics in the 1980s. And Taiwan's domestic photonics industry has significantly declined from offshoring. (In March, OIDA distributed a German report on photonics funding in Asia, shown at left and available here.)

Of course it's not a breeze to succeed in the U.S. either. American businesses have plenty of complaints, but just going by the numbers, the U.S. photonics market is in pretty good shape. More information on regional markets can be found periodically in the bi-monthly OIDA Market Update.
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Update on U.S. Export Control Reform
The finalized revised rules for export control reform for Category XII of the U.S. Munitions List and corresponding Commerce Control List are due out soon from the Obama Administration. The rules control the export and import of military-related items, including optics and photonics for a wide range of applications.
The first drafts were issued in May 2015, followed by a public comment period, second drafts, and a second public comment period. In April the internal government committee reviewing the public comments came to final agreement over what will be in the final rules. Next, the final draft will be shared with the Commerce Department SITAC committee and sent to the Office of Management and Budget (OMB) for a final review. The Administration has a self-imposed deadline to get new rules to OMB before June 1st in order to get them published by the end of Obama's term. The OMB process takes time because it has a backlog of rules to review.

The OMB-reviewed rule changes will be sent to the Congressional House and Senate Foreign Relations Committees for a 60-day notification and review. It is unlikely that Congress would suggest major changes or add new language to the proposed rule changes, but it might be able to suggest that proposed language be removed. By law, Congress needs to be consulted, but it has no official vote of authorization over this process.

OIDA expects the final rules to be published in the Federal Register by late summer or early fall.

In February, OSA's Chief Scientist Dr. Greg Quarles testified before the House Small Business Committee regarding the proposed rule's effect on small business. OSA's public policy staff continue to closely follow and contribute to this process. For questions, please contact Laura Kolton at lkolto@osa.org.
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Welcome New Industry Members Top

OSA Enabled by Optics Corporate Winner to be Recognized at CLEO Next Month
OSA will recognize this year's corporate Enabled by Optics contest winner at the plenary keynote session of the Conference on Lasers and Electro-Optics (CLEO), 05-10 June, 2016, in San Jose, California, USA. In addition, corporate winner Consumer Physics will delve into SCiO via a panel demonstration during the conference on Wednesday, 8 June.

Consumer Physics' SCiO is a product that takes near-infrared spectroscopy and shrinks the system behind it from room-sized equipment to a hand-held sensor that integrates with smart phones. This molecular sensor then fits in the palm of your hand, offering insights on everything from what's in your lunch to what pills you're taking. "It's remarkable what Consumer Physics has done," said Dr. Gregory Quarles, chief scientist, The Optical Society." By finding a way to condense a full scanning system, spectroscopy applications increase exponentially. As materials are scanned and identified and the spectral image is recorded and stored, the use cases for this technology grow. It's what's exciting about optics: the possibility transcends the technology of today, providing solutions for tomorrow."
Click here to watch video about Consumer Physics and the world's first molecular scanner. Conference registration information is available at cleoconference.org.
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There's Still Time to Exhibit at CLEO
With more than 4,400 attendees from all sectors of the market, CLEO provides a global marketplace where the industry learns, networks, connects, and closes deals. Reserve your space today. Time is running out. Learn More
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The Optical Science Division of the Naval Research Laboratory (NRL) is Seeking Proposals
NRL is seeking proposals for innovative research supporting ongoing programs within the Optical Sciences Division - the 9 technology topic areas are enumerated here.

The Optical Sciences Division is interested in receiving proposals for research related to these interests. White Papers can be sent to OptSciNRL@nrl.navy.mil and should include a rough cost estimate. The subject of the email shall be "Subj: BAA #56-15-01, Topic # and Topic Title". White Papers should be submitted in either Word or PDF format. If the White Paper is found to be consistent with the intent of the BAA, the applicant may be invited to submit a formal proposal. If selected to submit a full proposal, additional guidance will be provided.

This BAA is set to close February 17, 2017.
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Business and Society in the Age of Accelerating Returns
Join OSA as we celebrate our 100th anniversary with the Light The Future speaker series at CLEO featuring Ray Kurzweil, inventor, author, futurist, with Steven Chu, Nobel Laureate, former U.S. Secretary of Energy, OSA Fellow, on Wednesday, 8 June 2016, The San Jose Convention Center, Grand Ballroom, 18:30 — 20:00 PDT.

The 21st century is an era in which the very nature of what it means to be human will be both enriched and challenged, as our species breaks the shackles of its genetic legacy, and achieves inconceivable heights of intelligence, material progress, and longevity. While the social and philosophical ramifications of these changes will be profound, and the threats they pose considerable, celebrated futurist Ray Kurzweil presents an inspiring vision of our ultimate destiny in which we will merge with our machines, can radically extend our lives, and are vastly more intelligent. The event is free and open to the public. RSVP: LightTheFuture@osa.org.
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Write the Future
Join the "Write the Future" story contest and share your vision of optics and photonics To enter, write a short fiction story in 300 — 500 words on the future of our field. The winner's story will be published in OPN and will be recognized at OSA's 100th annual meeting, Frontiers in Optics, 17—21 October, in Rochester, New York, USA.

Enter to win $500 and a trip to FiO. Submission deadline: 30 June 2016. Send entry with your name, affiliation, email and story title to writethefuture@osa.org For detailed contest guidelines go to osa.org/storycontest.
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Check out these Newly Published Engineering and Laboratory Notes in Applied Optics
Applied Optics publishes articles called Engineering and Laboratory Notes (E&L Notes). These articles are intended to give engineers and technicians a venue to highlight laboratory techniques and hands-on skills required for the design, analysis, fabrication, integration, alignment, and measurement of optical components and systems.

Check out these recently published E&L Notes: Want to publish an E&L Note? Submit your manuscript today! If you aren't yet ready to submit, read this editorial by the E&L Notes Editor Brian Monacelli to learn more.
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Call for Nominations — Paul F. Forman Team Engineering Excellence Award
Team nominations for the Paul F. Forman Team Engineering Excellence Award are due 2 July. This is a great opportunity to showcase the value and importance of engineer teams! Named in memory of Paul F. Forman, the award recognizes technical achievements such as product engineering, process and software development, and patent development, as well as contributions to society such as engineering education, publication and management, and furthering public appreciation of optical engineering. Submit your team nominations by 2 July 2016. The awards will be presented in October during Frontiers in Optics 2016, OSA's 100th Annual Meeting. Recent winners include: Logic Analysis Tool Team (LAT Team), Intel Silicon Photonics Solutions Group, ZygoLOT Automotive Precision Optical Team, and Georgia Tech Research Institute (GTRI) Lidar Team.
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Want to get even more insight and access to great discussions about optics and photonics?
Join 3,000 of your colleagues in our Optics & Photonics Industry Network LinkedIn Group. This one-of-a-kind Forum for Industry lets you participate in discussions about cutting-edge issues. Extend your professional network. Exchange information about problems, ideas and solutions. Collaborate with experts in your field. Now is the perfect time to build a relationship with fellow optics and photonics professionals!
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Take advantage of your OSA Industry Development Associates Member Benefits
We are committed to ensuring the value of your OSA Industry Development Associates Membership, so please email OSA if you have any suggestions for new programs or comments on your membership.

Forward this message to your colleagues.

Not yet a member? Learn more about the benefits of membership.
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OSA Industry Development Committee
Thank you to the volunteers who oversee the programs and services available to the Industry Community.

 • Alex Fong,
    Gooch & Housego, Chair

 • Jean-Michel Pelaprat,
    Figulus, Past Chair

 • Henrik Skov
    Andersen,
    Ibsen Photonics

 • Simin Cai,
    Go!Foton
• John Dexheimer,
    Lightwave Advisors

 • James Fisher,
    Newport

 • Fred Leonberger,
    EOvation
    Technologies, LLC

 • Claudio Mazzali,
    Corning, Inc.
 • Mike Mielke,
    Trumpf

 • Martin Seifert,
    Nufern

 • Costel Subran,
    Opton Laser
    International

 • Christoph Harder,
    Harder and Partner,
    Liasison