LightCounting comments on release of Huawei’s CFO and product announcement made by Cisco (Acacia) and Nokia last week
After almost three years of negotiations, China and the US have reached a compromise on the fate of Ms. Meng, Huawei’s CFO, arrested in Canada. This was a cold war style exchange, as China released two Canadian citizens detained soon after Ms. Meng arrest in the end of 2018. Ms. Meng was given a big hero’s welcome on her arrival in China last Saturday, but her release was a long overdue gesture of good will at the onset of Cold War 2.0.
Huawei remains entangled into a web of US sanctions, restricting the company’s access to the latest semiconductor technologies, while Cisco and Nokia charge ahead with new products based on 7nm and 5nm CMOS. Cisco (Acacia) announced new 1.2Tbps single channel coherent pluggable modules on Thursday last week, shown in the figure below. Two days earlier, Nokia released its FP5 chip with 100G SerDes, enabling a new family of routers, supporting 400G and 800G optics.
Acacia has a phenomenal success record in the market for coherent DWDM optics and it continues to stay ahead of the competition as part of Cisco now. Cisco was forced to double the value of its Acacia’s acquisition in January 2021, as Acacia reported higher than expected sales of two-channel 1.2 Tbps AC1200 products in 2020. Amazon is the main consumer of AC1200 and it is very likely that the new product is designed with Amazon in mind.
Nokia’s new FP5 router chip is not a record holder in terms of throughput (4.8T), but it is the only router chip with 100G SERDES on the market, supporting 800G pluggable optics. Deployments of 400G on core routers remains in early stages, while 800G is becoming available (see High Speed Ethernet Optics Report).
If service providers skip 400G routers and go straight to 800G, this will not be good for Cisco’s grand strategy for routed optical networks, enabled by 400ZR. Acacia’s team must be under a lot of pressure to introduce 800ZR next year.
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