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Fujitsu and Avanex Reach Agreement on Common Specifications for VIPA-type Dispersion Compensation Modules for Optical Transmission Systems

-- Companies aim to establish de facto standard --


Tokyo and Fremont, Calif. July 16, 2001---Fujitsu Limited and Avanex Corporation today announced that they have reached an agreement to standardize specifications for virtually imaged phased array (VIPA *1) dispersion compensation modules, a tunable type of dispersion compensation device considered indispensable to realizing next- generation 40 gigabits per second high-speed optical transmission systems. By offering products based on this agreement, the two companies will aim to establish the de facto standard for dispersion compensation modules.

[Dispersion compensation modules]
In optical transmission systems, optical signals become distorted (wavelength dispersion) during transmission through optical fibers. Dispersion compensation modules correct such distortion and return signals to their original state.

Until now, conventional optical transmission systems that operate at 10 gigabits per second have corrected wavelength dispersion by using a dispersion compensating fiber (DCF). Next-generation high-speed optical transmission systems, however, require higher performance wavelength compensation devices, such as "tunable" types, capable of making minute corrections to wavelength dispersion, which changes according to environmental factors such as the type and length of fiber as well as temperature.

In addition, tunable wavelength compensation devices have the potential to make initial installation of conventional optical transmission systems more economical.
In order to address the increase in transmission traffic resulting from the spread of broadband Internet, the capacity of optical transmission systems is increasing, and it is anticipated that next-generation optical transmission systems will feature 40 gigabits per second capacity. Several technical issues have hindered the development of next-generation systems. However, the new dispersion compensation devices have solved one major issue, thus paving the way for significant progress toward making these systems a reality.

Since 1998, Fujitsu and Avanex have been separately developing new tunable-type dispersion compensation modules that utilize VIPA technology. Based on this new agreement, they will standardize specifications for such things as mechanical characteristics (fixing method), module size, optical characteristics (insertion loss), tunable dispersion range, driving voltage and control method. In addition, they will standardize guidelines for dispersion compensation management (*2). Fujitsu and Avanex also plan to sign a multi-source agreement (MSA *3).

According to market research company RHK, the worldwide market for dispersion compensation modules is expected to grow from $177 million (about 20 billion yen) in 2000 to $433 million (about 50 billion yen) in 2004. In 2000, DCF constituted a great part of this market; however, with the spread of high-speed optical transmission systems, which require higher-performance dispersion compensation, the share of tunable dispersion compensation equipment is anticipated to increase.

Fujitsu is currently sampling VIPA-type dispersion compensation modules for 10 gigabits per second optical transmission systems and plans to start volume shipments in late 2001. Moreover, it is now developing VIPA-type dispersion compensation modules for next- generation 40 gigabits per second high-speed optical transmission systems, with product shipments expected to begin in 2002.

Fujitsu will exhibit its VIPA-type dispersion compensation module prototype for next-generation high-speed optical transmission systems at InterOpto2001, which takes place from July 16 at the Makuhari Messe in Chiba, Japan.

Avanex is currently marketing the VIPA dispersion compensator devices under the trademark of PowerShaper(TM). The PowerShaper(TM) product for 10 gigabits per second OC-192 transmission application is in pilot production stage and have been deployed in the field since 2000. The PowerShaper(TM) products for 40 gigabits per second application have already successfully passed a number of field trials, and are planning to go into pilot production in the second half of 2001.

[Terminology]
(*1) VIPA (Virtually Imaged Phased Array):
VIPA is a type of tunable dispersion compensation module that can flexibly support the fluctuating dispersion characteristics of high-speed transmission. Fujitsu and Avanex jointly own a number of patents for the VIPA dispersion management device. It comprises a thin plate coated on both sides with a reflecting film and a reflecting mirror.

(*2) Dispersion compensation management guidelines:
Guidelines for design of dispersion compensation systems (e.g. number of compensation modules to be installed and their location in the system).

(*3) MSA (Multi Source Agreement):
Agreement on common specifications that enable other vendors to provide multiple sources for customers.

VIPA dispersion compensation module diagram VIPA dispersion compensation module diagram
[Click to enlarge]

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[About Fujitsu]
Fujitsu is a leading provider of Internet-focused information technology solutions for the global marketplace. Its pace-setting technologies, best-in-class computing and telecommunications platforms, and worldwide corps of systems and services experts make it uniquely positioned to unleash the infinite possibilities of the Internet to help its customers succeed. Headquartered in Tokyo, Fujitsu Limited (TSE:6702) reported consolidated revenues of 5.48 trillion yen for the fiscal year ended March 31, 2001.
Internet: http://www.fujitsu.com/

[About Avanex]
Avanex designs, manufactures and markets photonic processors for the communications industry. Avanex's photonic processors offer communications service providers and optical systems manufacturers greater levels of performance and miniaturization, reduced complexity and increased cost-effectiveness as compared to current alternatives. Avanex was incorporated in 1997 and is headquartered in Fremont, Calif. In addition to a development and manufacturing facility in Fremont, the company also maintains The Photonics Center(TM) in Richardson, Texas, and a development facility in Hudson, Mass. To learn more about Avanex, visit its web site at: www.avanex.com.

*Forward-looking Statements
This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act. Actual results could differ materially from those projected in the forward-looking statements. Forward-looking statements involve risks and uncertainties including, but not limited to, our inability to sufficiently anticipate market needs and develop products and product enhancements that achieve market acceptance.

Avanex undertakes no obligation to publicly release the result of any revisions to these forward-looking statements, which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

[Fujitsu Contact Information] [Avanex Contact Information]
Press contacts:
 Takehiro Hayashi, Scott Ikeda
 Fujitsu Limited, Public Relations
 Tel: +81-3-3215-5259 (Tokyo)
 Fax: +81-3-3216-9365
 E-mail: pr@fujitsu.com

Customer Contact:
 Jun Hasegawa
 OEM Promotion Department,
 Communication Circuit & Device Technology
 Division, Transport Systems Group
 Tel: +81-44-754-3087
 e-mail: hasegawa.jun@jp.fujitsu.com
Media contact:
 Tony Florence
 Tel: +1-510-897-4162 (Calif.)
 Fax: 1-510-897-0189
 e-mail: tony_florence@avanex.com

Investor Relations:
 Mark Weinswig
 Tel: +1-510-897-4344
 Fax: +1-510-897-4345
 e-mail: mark_weinswig@avanex.com
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