I've always held that Avago (based in Sunnyvale) would be a good #2 after Finisar.

recall, they used to be the semiconductor arm of HP.

now, two things are going on there right now, each with key events scheduled to close before the end of this year:

• Avago acquisition of Broadcom
• Avago divestiture of their optical product line to Foxconn (FIT)

we can celebrate that Foxconn is a prime cog in the iThing wheel (hurrah!), but FIT (Foxconn Interconnect Technology) is a separately-managed business unit which shares the same parent as the custom-assembly BU that everybody thinks of when they hear Foxconn (Hon Hai Precision Industry Co. Ltd.).

when you hear FIT, think Amphenol or Molex ... cables, connectors, cable assemblies, some specialty fiber optic products.

Foxconn's net income overall is pretty lousy (last quarter delivered 2.3% on $29.5B revenue); another contract manufacturer (Fabrinet) that interestingly enough focusses on assembling optical modules did better, at 6.3% net.

it's a very low-margin business to be in.

being the rascal that I am, I'm always wary of Chinese industrial espionage, however FIT's R&D in Taiwan is mostly SiPho, whereas their site in Brea, California is "other" optical ... if we go near them, at least it keeps things onshore (however much of a comfort that is anymore, I'm not so sure).

here's something to chew on.

sending Avago's optical product line to FIT (who already have 9,000 patents and 70,000 employees) might pave the way to get POET into Avago for their semiconductor (rather than transciever) business, without conflict.

in the grand scheme of things, shooting bits around with SFPs is pretty easy, that's why they get knocked off like candy, and wind up about as cheap, eventually.

logic (including tri-state memory/storage) -- and ultimately CPUs? not so much.

that's where the real POET money is going to be.

transceivers are just going to get us there.

in a perfect world, we could eventually start to wind up being paired up like this on the consumer side:

• Finisar - transceivers
• Avago - embedded/specialty
• Micron - ram
• FruitCo - cpu

... with GF and/or WINsemi getting first kick at the can as producers.

imo.

GLAL,

R.