SDL Announces New Generation of 980 nm Pump Modules

Pump Module Powers Up to 300 mW to Satisfy Market Demand for Higher Bandwidth, Higher Channel Count and Greater Distances

SAN JOSE. SDL, Inc. (Nasdaq: SDLI) announced today a new generation of pump modules for use in erbium doped fiber amplifiers (EDFAs). These new high power pump modules will be used in dense wavelength division multiplexed (DWDM) fiber optic networks to satisfy the projected increase in demand for higher channel count and longer transmission distance. The SDLO-2700 Series utilizes SDL s new 6540 chip that has operated at over 500 mW of optical power, and an advanced fiber coupled package with reduced dimensions that has greatly improved thermal performance. The combination of new chip technology and new packaging techniques allows the introduction of module power levels to 300 mW. The SDLO-2700 series is designed to meet the performance and reliability requirements of the rapidly growing EDFA market for long haul terrestrial DWDM networks as well as Metro/CATV networks.

The SDLO-2700 uses a new generation of chip specifically designed to operate with SDL s patented fiber Bragg grating. This unique combination has pushed the maximum power available from grating stabilized 980 nm pump modules to a new high of 300 mW. Previously, SDL s highest power grating stabilized pump modules operated at 180 mW. The use of fiber Bragg gratings with pump lasers creates wavelength stabilized pumps that result in more stable EDFA performance, independent of input signal wavelength. As one of the first manufacturers of 980 nm pump lasers, SDL has leveraged its unique vertically integrated laser diode capability and its considerable design and volume production experience to meet new market demands.

SDLO-2700 Series modules are available now in sample quantities. Production quantities are expected in the second half of 2000. According to Gregory P. Dougherty, chief operating officer of SDL, "We believe the 2700-Series product line will enable new EDFA designs that will help to satisfy market demand for higher bandwidth, higher channel count and greater distances. This pump module uses SDL s 6540 chip which, we believe, represents the most capable 980 nm pump chip in the world. This chip, coupled with our new planar package, allows us to break through the 180mW barrier to new highs for 980 nm pump modules. Because of the improved thermal performance, reduced package height and ultra high power at a cost effective price, we believe we will be positioned to penetrate markets in which SDL has not previously participated."

SDL s products power the transmission of data, voice and Internet information over fiber optic networks to meet the needs of telecommunications, dense wavelength division multiplexing (DWDM), cable television and satellite communications applications. They enable customers to meet the bandwidth needs of increasing Internet, data, video and voice traffic by expanding their fiber optic communications networks much more quickly and efficiently than would be possible using conventional electronic and optical technologies. SDL s optical products also serve a variety of non-communications applications, including materials processing and printing. Additional information about SDL, Inc. is available on the Internet at www.sdli.com .

Statements in this press release which are not historical including statements regarding SDL s or management s intentions, hopes, beliefs, expectations, representations, projections, plans or predictions of the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include statements regarding the potential applications for the SDLO-2700 Series products, the increased benefits they will offer to the company s customers, the growing EDFA market, the increasing demand for higher channel count systems and greater reliability, the company s ability to penetrate new markets and to meet market demand, the ability to ship production samples in the second half of 2000, the ability to enable new EDFA designs, and the company s 980 nm pump module being the most capable in the world today. It is important to note that the Company s actual results could differ materially from those in any such forward-looking statements. Factors that could cause actual results to differ materially include the company s inability to achieve expected power and reliability levels in commercial production quantities, customer qualification or manufacturing of the new product, lack of market acceptance, alternative technologies, competitors products, and the risk factors listed from time to time in the Company s SEC reports including but not limited to, the annual report on Form 10-K and 10-K/A for the year ended January 1, 1999, and the quarterly reports on Form 10-Q for the quarters ended March 31, June 30, and September 30, 1999.

For more information on SDL, Inc. at no cost, please call 800-PRO-INFO (U.S.) or 732-544-2850 (Int l), ticker SDLI .

SOURCE: SDL, Inc.

CONTACT:
Donald R. Scifres, Chairman and CEO, or
Michael L. Foster, VP Finance and CFO, both of SDL, Inc., 408-943-9411
or
Lisa Horn Chainey (General Info.), Susan Katz (Investors) or
Scott Marx (Media), all of The Financial Relations Board, 415-986-1591

Web site: http://www.sdli.com