https://www.linkedin.com/feed/update/urn:li:activity:7134942870842544128/

Since the announcement of the acquisition of Cloud Light, Lumentum has been telegraphing the importance of its direct relationship more generally with Google (please see: https://lnkd.in/eMbr4kzF). Despite no inherent, causal link between the acquiree and optical circuit switching (specifically MEMS -- https://lnkd.in/eMaMprGi), there has been a greater emphasis placed on such development work by the acquirer. Also, CEO, Alan Lowe, made the points on that last earnings call (see last link), “we hope not to screw [the Cloud Light operation] up, frankly” and “we're trying to let them do their stuff and not distract them.” Those statements would commonsensically reflect the sentiments of Google which has strived to make the China-based vendor into “InnoLight II” (please see: https://lnkd.in/e5NNZ2ZH). In actuality, the customer probably believes that it is already making a sacrifice in that it would likely be able to get better pricing from Cloud Light, as an independent entity. Consequently, at least for a while, Google most likely wishes Lumentum to truly remain in the position of a holding company (please see: https://lnkd.in/evnS6jhD) in this situation as much as possible. (Additionally, fibeReality also has learned that there is a close relationship between Wupen Yuen, Lumentum’s President, Cloud and Networking Platform and the optics engineering team at Google.)

On the matter of the OCS, the barriers to entry for the other hyperscalers are quite high (please see: https://lnkd.in/eSQPkTsr). Once again, fibeReality’s present understanding of the work being done by Lumentum is targeted to Google’s needs. The comment during that latest earnings conference by Chris Coldren, SVP and Chief Strategy and Corporate Development Officer at Lumentum, does not appear to be a ringing endorsement for other users being expected to get involved with optical switches in a big way anytime soon: “I would say, in terms of time to market, a little premature to talk about an exact time frame, but I think over the next year, you're going to hear a lot more about it as prototypes begin to ship.”