Technical Insight
3 inch InP facility could give Bookham the edge
Last year, Bookham Technology transferred one of the world's most advanced InP fabs from Ottawa, Canada, to Caswell, the former Marconi facility in the heart of the English countryside. Michael Hatcher visited Caswell to check up on Bookham's progress.
Bookham Technology has undergone something of a metamorphosis in recent times. Originally set up in 1988 to develop silicon-based planar optical circuits, it soon became saddled with a technology that was not needed by the fiber-optic telecom market. However, Bookham s initial public offering in 2000 was so successful that it gave the company a tremendous cash reserve to exploit as the market crashed and competitors started to melt away. After acquiring both Nortel Networks Optical Components (NNOC) and Marconi Optical Components (MOC) in 2002, the UK-based company has ditched its own technology and established itself as a major manufacturer of III-V fiber-optic components.
Acquisition spreePrior to the acquisition, Nortel s highly automated InP fab in Ottawa had cost an estimated quarter of a billion dollars to assemble. Bookham snapped up the facility as part of its NNOC acquisition. Last year, the company relocated the Ottawa fab and integrated it with the existing GaAs fab in Caswell, UK, that it had acquired from MOC. Bookham believes it to be the only 3 inch InP wafer fab located outside North America.
Nortel had previously tried and failed to relocate the facility to its UK packaging plant in Paignton. Following its acquisition spree in 2002 and 2003, Bookham found itself with eight fabrication facilities in a market with barely sufficient demand for one. Since then, six of these fabs - located at Milton, Harlow and Paignton in the UK, plus Ottawa and Boston in North America - have been closed. Two fabs remain. With integrated facilities producing 3 and 6 inch GaAs wafers and 2 and 3 inch InP wafers using its seven MOVPE chambers and single MBE reactor, Bookham s III-V facility in Caswell can claim to be one of the most advanced optoelectronics manufacturing plants in the world. Its second fab is in Zurich, Switzerland (it was formerly owned by JDS Uniphase before being sold to Nortel), producing 980 and 1480 nm lasers for telecom applications and diode laser bars for industrial laser applications.
The Caswell fab has a fine pedigree when it comes to GaAs device development. Originally built by the aircraft radio maker Plessey during the Second World War (its countryside location was a deliberate ploy to avoid aerial bombing; Caswell village is too small to appear on most maps), Caswell has been the focus for III-V device development in the UK for more than 40 years (see timeline).
Lithography advantageMike Syrett and Chris Sansom are now responsible for operating the integrated Caswell fab. Prior to the Ottawa fab transfer, InP devices were made on 2 inch wafers at Caswell. Syrett and Sansom say that the step up to a 3 inch facility has implications far beyond simply being able to produce more devices per wafer. One key example is lithography. Syrett explained that using 3 inch wafers means that more advanced stepper lithography equipment may be employed, capable of producing feature sizes of just 0.1 µm. This is because lithography equipment manufacturers tend to avoid the relatively small 2 inch wafer market and concentrate on making systems suitable for larger wafers. Higher throughput of up to 70 wafers per hour and automated alignment are also key advantages. Indeed, the level of automation in the InP facility is impressive, more typical of a silicon fab than many III-V facilities. The NNOC deal also saw Bookham acquire a Leica electron beam tool. Unjustifiably expensive for most fabs to install, Bookham uses the tool to write gratings for its tunable lasers with greater precision than is possible with standard fab equipment.
Automation, larger wafers and higher throughput will undoubtedly help to reduce the cost of InP-based devices - provided there is a return to higher demand. The Bookham team says that its devices will be far cheaper than those made in conventional 2 inch fabs, just as soon as the demand for high product volumes returns. Unlike NNOC, Bookham will not be restricted from selling components to Nortel Networks rivals, and will be able to sell products to any of the fiber-optic module manufacturers. But the high throughput advantages of the 3 inch InP fab will only become fully apparent when strong demand returns, and when this is likely to happen remains an open question. The 6 inch GaAs fab will also benefit from a telecom rebound, since Bookham s optical modulators and some of its transmitter chips are based on GaAs. At the moment, the InP facility is estimated to be working at 10-15% of its potential capacity. The combined capacity of the InP and GaAs facilities at Caswell is estimated to be 50,000 wafer starts per year.
Crucial years aheadHaving come through a "complex, difficult, but ultimately successful" year in 2003, the next two years look to be crucial. Bookham expects the long-haul optical networking market to remain flat, albeit valuable, in 2004. "We have hit the bottom [of the market] and I think 2005 will be the key year," said Daniel Sims, product manager for Bookham s optical networking gear. In the near term, the access market looks to have better prospects than long-haul, says Sims, with the convergence of datacom and telecom a key factor. Another of Bookham s recent acquisitions - US-based Ignis Optics - is focused on this market.
Despite last year s extensive consolidation in the fiber-optic components industry, much of it instigated by Bookham itself, Sims believes that more of the same is necessary before the industry recovers fully. He thinks that 10 Gbit/s systems for metropolitan networks is a key technology in the near term, and with this in mind the company recently announced that it had extended the range of one of the Ignis products. The new version of its XFP transceiver module features a 1550 nm source in place of the 1310 nm source used before, and a reach of 40 km rather than 10 km.
Bookham s acquired expertise in non-telecom applications should not be forgotten. Marconi Caswell had a proud history of developing high-performance microelectronic devices for military and space applications, before this side of the operation became somewhat sidelined. Bookham recently regained space-qualification of its GaAs devices from Astrium, Europe s leading satellite manufacturer, which had been allowed to slip under Marconi s focus on photonics technologies.
Bookham estimates that 5% of its business comes from non-telecom activity currently, and this is set to increase significantly once the proposed acquisition of New Focus is complete. A major factor in the New Focus deal - as well as acquiring $105 million cash (figure 1) and an empty manufacturing facility in Shenzen, China - was the inclusion of New Focus s subsidiary JCA Technology. JCA specializes in high-performance RF components and modules used in military and space applications. As a result, an investigation by the US Securities and Exchange Commission (SEC) has held up the acquisition, while approval of the deal is still needed from New Focus shareholders. However, Bookham s director of communications Sharon Ostaszewska assured Compound Semiconductor that the New Focus deal should be completed by the end of March.
One of Bookham s key products in the GaAs microelectronics sphere could be a high-performance X-band driver amplifier. These high-power devices are used in advanced phased-array radar equipment, and TriQuint s 8 W device is currently the leading technology. However, the Oregon-based company is for now restricted from selling these devices outside of the US, which leaves a market opportunity in the rest of the world for Bookham. So far, Bookham has a commercial 1 W X-band driver amplifier and is working on improving the power output level.
However, only a significant rebound in the optical telecom market will allow Bookham to fully exploit its undoubted GaAs and now InP manufacturing capability. The next phase of Caswell s III-V history depends on it.
Acquisition spreePrior to the acquisition, Nortel s highly automated InP fab in Ottawa had cost an estimated quarter of a billion dollars to assemble. Bookham snapped up the facility as part of its NNOC acquisition. Last year, the company relocated the Ottawa fab and integrated it with the existing GaAs fab in Caswell, UK, that it had acquired from MOC. Bookham believes it to be the only 3 inch InP wafer fab located outside North America.
Nortel had previously tried and failed to relocate the facility to its UK packaging plant in Paignton. Following its acquisition spree in 2002 and 2003, Bookham found itself with eight fabrication facilities in a market with barely sufficient demand for one. Since then, six of these fabs - located at Milton, Harlow and Paignton in the UK, plus Ottawa and Boston in North America - have been closed. Two fabs remain. With integrated facilities producing 3 and 6 inch GaAs wafers and 2 and 3 inch InP wafers using its seven MOVPE chambers and single MBE reactor, Bookham s III-V facility in Caswell can claim to be one of the most advanced optoelectronics manufacturing plants in the world. Its second fab is in Zurich, Switzerland (it was formerly owned by JDS Uniphase before being sold to Nortel), producing 980 and 1480 nm lasers for telecom applications and diode laser bars for industrial laser applications.
The Caswell fab has a fine pedigree when it comes to GaAs device development. Originally built by the aircraft radio maker Plessey during the Second World War (its countryside location was a deliberate ploy to avoid aerial bombing; Caswell village is too small to appear on most maps), Caswell has been the focus for III-V device development in the UK for more than 40 years (see timeline).
Lithography advantageMike Syrett and Chris Sansom are now responsible for operating the integrated Caswell fab. Prior to the Ottawa fab transfer, InP devices were made on 2 inch wafers at Caswell. Syrett and Sansom say that the step up to a 3 inch facility has implications far beyond simply being able to produce more devices per wafer. One key example is lithography. Syrett explained that using 3 inch wafers means that more advanced stepper lithography equipment may be employed, capable of producing feature sizes of just 0.1 µm. This is because lithography equipment manufacturers tend to avoid the relatively small 2 inch wafer market and concentrate on making systems suitable for larger wafers. Higher throughput of up to 70 wafers per hour and automated alignment are also key advantages. Indeed, the level of automation in the InP facility is impressive, more typical of a silicon fab than many III-V facilities. The NNOC deal also saw Bookham acquire a Leica electron beam tool. Unjustifiably expensive for most fabs to install, Bookham uses the tool to write gratings for its tunable lasers with greater precision than is possible with standard fab equipment.
Automation, larger wafers and higher throughput will undoubtedly help to reduce the cost of InP-based devices - provided there is a return to higher demand. The Bookham team says that its devices will be far cheaper than those made in conventional 2 inch fabs, just as soon as the demand for high product volumes returns. Unlike NNOC, Bookham will not be restricted from selling components to Nortel Networks rivals, and will be able to sell products to any of the fiber-optic module manufacturers. But the high throughput advantages of the 3 inch InP fab will only become fully apparent when strong demand returns, and when this is likely to happen remains an open question. The 6 inch GaAs fab will also benefit from a telecom rebound, since Bookham s optical modulators and some of its transmitter chips are based on GaAs. At the moment, the InP facility is estimated to be working at 10-15% of its potential capacity. The combined capacity of the InP and GaAs facilities at Caswell is estimated to be 50,000 wafer starts per year.
Crucial years aheadHaving come through a "complex, difficult, but ultimately successful" year in 2003, the next two years look to be crucial. Bookham expects the long-haul optical networking market to remain flat, albeit valuable, in 2004. "We have hit the bottom [of the market] and I think 2005 will be the key year," said Daniel Sims, product manager for Bookham s optical networking gear. In the near term, the access market looks to have better prospects than long-haul, says Sims, with the convergence of datacom and telecom a key factor. Another of Bookham s recent acquisitions - US-based Ignis Optics - is focused on this market.
Despite last year s extensive consolidation in the fiber-optic components industry, much of it instigated by Bookham itself, Sims believes that more of the same is necessary before the industry recovers fully. He thinks that 10 Gbit/s systems for metropolitan networks is a key technology in the near term, and with this in mind the company recently announced that it had extended the range of one of the Ignis products. The new version of its XFP transceiver module features a 1550 nm source in place of the 1310 nm source used before, and a reach of 40 km rather than 10 km.
Bookham s acquired expertise in non-telecom applications should not be forgotten. Marconi Caswell had a proud history of developing high-performance microelectronic devices for military and space applications, before this side of the operation became somewhat sidelined. Bookham recently regained space-qualification of its GaAs devices from Astrium, Europe s leading satellite manufacturer, which had been allowed to slip under Marconi s focus on photonics technologies.
Bookham estimates that 5% of its business comes from non-telecom activity currently, and this is set to increase significantly once the proposed acquisition of New Focus is complete. A major factor in the New Focus deal - as well as acquiring $105 million cash (figure 1) and an empty manufacturing facility in Shenzen, China - was the inclusion of New Focus s subsidiary JCA Technology. JCA specializes in high-performance RF components and modules used in military and space applications. As a result, an investigation by the US Securities and Exchange Commission (SEC) has held up the acquisition, while approval of the deal is still needed from New Focus shareholders. However, Bookham s director of communications Sharon Ostaszewska assured Compound Semiconductor that the New Focus deal should be completed by the end of March.
One of Bookham s key products in the GaAs microelectronics sphere could be a high-performance X-band driver amplifier. These high-power devices are used in advanced phased-array radar equipment, and TriQuint s 8 W device is currently the leading technology. However, the Oregon-based company is for now restricted from selling these devices outside of the US, which leaves a market opportunity in the rest of the world for Bookham. So far, Bookham has a commercial 1 W X-band driver amplifier and is working on improving the power output level.
However, only a significant rebound in the optical telecom market will allow Bookham to fully exploit its undoubted GaAs and now InP manufacturing capability. The next phase of Caswell s III-V history depends on it.
