The Mostly Successful LED Lighting Market
OIDA distributed an assessment of LED lighting to members last month that illustrates the success of government efforts and of the market to reduce the price and increase the volume of LED lighting. LED lighting has passed a "tipping point" such that further penetration is inevitable. Continued sales help drive down manufacturing costs, which allows for lower prices to customers, further driving up sales in a virtuous cycle.
The report, which is publicly available from the National Academies Press, provides Phase Two to an earlier 2013 report. The combined reports assess the U.S. Department of Energy's program in LED lighting, which is currently funded at about $24 million per year. The U.S. government's aim is for a more energy efficient economy, including the use of LEDs for lighting and solar cells for energy generation.
The figure from the report illustrates how the average selling price for A-type replacement bulbs declined dramatically while cumulative installations grew. It was initially not anticipated that the progress would be this swift, considering the many technical and market challenges. National mandates for improved lighting efficiency were certainly pivotal in accelerating adoption. It's now clear that LED lighting will capture increasing market share from alternatives, even if the incumbent technologies never really disappear from the market.
|Source: Assessment of Solid-State Lighting, Phase Two (National Academies Press), pages 2 (top) and 19 (bottom).
It might seem that there is only upside in the market success of LED lighting, but it's not all good news for LED component suppliers. It's only good news if a company's unit sales increases faster than prices decline; maintaining revenues and profit margins. The LED market advanced so rapidly, however, that some companies are left with losses as prices erode and the product mixes change. Two major companies, Epistar and Cree, reported losses for the last two fiscal years. Nonetheless, the future does appear strong for the LED suppliers that navigate through this period of rapid change.
The Problem-Based Approach to Biophotonics Commercialization
The best approach to commercializing biophotonics technology is to start by examining a problem that health care providers face every day, and work with a team to find a solution. That may seem obvious, but it's not used widely or effectively. This was the message of a session on the commercialization of biophotonics at OSA's Biophotonics Congress in San Diego on 5 April 2017.
Moderating the panel was Gabriela Apiou, PhD, of Harvard Medical School and the Wellman Center for Photomedicine at Massachusetts General Hospital. The session featured two research physicians with real-world problems that beg for solutions.
How does one find the problems worth solving? One researcher says it's by "following the MD around on her rounds." He meant that both literally and metaphorically.
- Adam Raff, MD, PhD discussed cellulitis, an infection of a layer of the skin that afflicts tens of millions of people worldwide per year, and can be fatal. About 30% of patients are misdiagnosed, leading to ineffective and costly treatment. An optics-based point-of-care diagnostic tool is needed that is accurate, rapid, easy, and inexpensive.
- Theo Seiler, MD, PhD, discussed high myopia, a severe form of nearsightedness caused by continued elongation of the eye during early childhood. It can increase the risk for retinal detachment, early development of cataracts and glaucoma. Some treatments have been used to slow or stop the elongation but lasers offer a solution by crosslinking the structure of the eye to stop elongation. The goal is to find a one-time, minimally invasive solution that is effective in children with no side effects.
This modern, iterative approach to R&D is problem and market-centric: the end-use drives the next innovation. This iterative approach was used by the Wright brothers to build the first airplane, and is common in perfecting electronics. For example, Corning developed lightweight, damage-resistant glass decades ago, but the need to improve smartphone displays provided an opportunity to apply its product, called Gorilla Glass, to a commercial application.
The more traditional, serial approach to R&D is science and technology-centric. It was institutionalized in the U.S. by Vannevar Bush after World War II, and is evident in research funding classifications that restrict funding to early stage, "pre-competitive" R&D. It is largely used in pharmaceutical development today.
OIDA also addressed biophotonics commercialization in town hall events in April 2016 and October 2015, as reported in previous OIDA newsletters.
Canada's Photonics Industry Ranks Well Globally
Canada is among the top 10 producers in optics and photonics products, and yet is not widely recognized for its rank. And, its photonics community is in proportion to its population, compared to the European Union member countries and the U.S. This is one of the messages that OIDA will bring to a presentation on the outlook for photonics at a session on photonics commercialization at Photonics North on Wednesday, 7 June 2017.
Canada has optics and photonics employment of about 25,000, for a country with total employment of about 18 million. By comparison, OIDA estimates U.S. photonics employment at 385,000 (for total employment of 153 million) and European photonics employment (excluding Russia) at 322,000 (for total employment of 236 million). The per capital concentration of optics and photonics employment, called the location quotient, places Canada at about the same level as Europe, but less than the U.S.
Canada's photonics industry is geographically concentrated to a narrow strip along the St. Lawrence River—broadly circled in the figure. It is so highly concentrated, in fact, that it forms a "super-cluster" that counts nearly 90% of all Canadian optics and photonics. And it's just across the border from a larger super-cluster in the northeast U.S. that stretches from Rochester and Boston to Washington D.C., and which comprises about 38% of all U.S. optics and photonics employment.
Canadian national and provincial governments invest about Can$150 annually into optics and photonics, a value that also scales well with the U.S. and Europe. For perspective, Germany spends about €100M per year on its Photonik 2020 program, and the European Commission spends about the same amount on programs in its photonics unit (see the April OIDA newsletter). OIDA estimates that the U.S. government spends slightly over $1B on photonics R&D, which is approximately proportional to the larger U.S. population and government spending. Comparisons are difficult, however, as every country uses different policies and funding schemes to encourage its industries; funding alone does not tell the whole story. The Canadian photonics community is seeking to improve its government support to maintain Canadian competitiveness in the global market.
OIDA is pleased to have several Canadian members for many years, including the trade association Photons Canada, also known as the Canadian Photonic Industry Consortium (CPIC). We wish our Canadian members and the Canadian community a prosperous future. For more information, see also here.
NEW! The OFC Post-show Report — A Market Overview
||Each year, OFC showcases the most noteworthy developments in the optical communications industry, and this year was no exception. Companies utilized OFC as a venue to announce and demonstrate new products and solutions such as photonic integration, hardware disaggregation, and open management of large scale networks.
This report highlights and summarizes the 2017 developments in these areas:
Download and read the report. Share it with colleagues and save it for reference.
- Inside the Datacenter — 100G and the Road to 400G
- Building Towards 400G Coherent and Beyond
- Compact DCI — Not Just for Cloud and Colo
- Optical Networks — Open vs. Vertical Integration
- Outlook for 2017
Find Out How the Changing Political Landscape Will Impact Your Company
Attend a CLEO special Market Focus session on 17 May. Meet Government Relations experts as they discuss how the political changes in the United States and Europe will impact the optics and photonics industry. The US perspective provides an overview of the priorities of the Trump Administration and U.S. Congress. The EU perspective includes an overview of the upcoming elections in France and Germany and the impact of Brexit on funding and large scale collaboration projects. Don't miss this opportunity to learn how you will be impacted by these changes and how you can impact policy decisions with your policymakers.
Update on Optics and Photonics Markets and Opportunities
Mark your calendar now for 16 May at CLEO. This timely presentation will review the outlook for key optics and photonics industry sectors and upcoming market opportunities. It will provide a quantitative look at the present performance and trends, as well as examples of where to find industry growth longer term.
30 May is Your Last Opportunity to Submit to the OSA Laser Applications Conference
In its second year, The Laser Applications Conference (LAC) is an all invited speaker format for industry in Laser Applications at the OSA Laser Congress which will be held in Nagoya, Aichi, Japan 1-5 October 2017. This 3-day meeting focuses on two main topic areas — Materials Processing and Applications for High Power Lasers. Materials Processing includes advanced applications for industrial use. Applications for High Power Lasers will include topics such as EUV for Lithography, 16kW+ Laser Applications, X-Ray Generation, Lasers for Space Applications and Tool Making. The program will be made up primarily of invited speakers however submissions are also being encouraged. One of the themes of this conference will be intimate discussions on what engineering and production advances are needed to translate promising technological advances into marketable products. Submissions will be accepted through 30 May for this industry conference. View the timeline and read the submission guidelines. Mark your calendar to attend. Exhibit booths are still available.
60,000+ Professionals Use WORKinOPTICS.com. Find Your Perfect Job or Candidate Now.
The Optical Society's (OSA) online job board, WORKinOPTICS.com connects leading employers, qualified job and internship seekers and consultants within the optics and photonics community. Whether you're searching for a job, someone to fill a job, or exploring career options, WORKinOPTICS.com is a reliable global resource that can help you to make valuable connections in industry and academia.
OSA Industry Development Associates member companies get 20 free job postings! Learn more and join other OIDA members who have found new hires on WiO. "Optonicus has connected with highly qualified candidates with strong skill sets through the Work-in-Optics website, and we look forward to connecting with future team members as our business grows" Tom Tumolillo, Jr., COO of Optonicus
Don’t Miss the Latest Engineering & Lab Notes from Applied Optics
Engineering and Laboratory Notes (E&L Notes), from Applied Optics, highlight laboratory techniques and hands-on skills technicians and specialists can utilize for the design, analysis, fabrication, integration, alignment, and measurement of optical components and systems. E&L Notes Editor Brian Monacelli sums up the initiative here.
Applied Optics recently published these E&L Notes:
View all of the published E&L Notes here.
SHARE YOUR SKILLS: Applied Optics continues to seek E&L Notes to publish. Submit yours today.
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 2017. The award will be presented in September during Frontiers in Optics 2017. Recent winners include: Advanced LIGO Engineering Team, Logic Analysis Tool Team (LAT Team), Intel Silicon Photonics Solutions Group, ZygoLOT Automotive Precision Optical Team, and Georgia Tech Research Institute (GTRI) Lidar Team.
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!
Take advantage of your OSA Industry Development Associates (OIDA) Member Benefits
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|OSA Industry Development Associates Committee
Thank you to the volunteers who oversee the programs and services available to the Industry Community.
| • Alex Fong,
Gooch & Housego, Chair
• Claudio Mazzali,
Corning, Inc., Chair-Elect
• Henrik Skov
• Simin Cai,
|• John Dexheimer,
• Fred Leonberger,
• Mike Mielke,
• Martin Seifert
| • Costel Subran,
• Christoph Harder,
Harder and Partner