This morning I will review recent Sales and Market developments for each principal laser type and application market, and then discuss the projections in most of the major markets looking ahead through the end of 1988. In each of these major areas, there will be more elaborate data and analysis presented by the speakers who are specialists and industry leaders in each of these fields. My presentation is primarily based on the reports that you have in hand, or are available to you at the table outside. That is to say the annual economic review and outlook that appears in the January issue of Laser Report and in more summary form in Laser Focus that was prepared by our business editor, David Kales, who will be speaking later on a related subject. So, much of what I have to say is based on the methodology that we have traditionally used through the years in the annual Laser Focus and Laser Report reviews, which is to go to the primary manufacturers and suppliers and interrogate them as to their own sales and their own projections of the worldwide market in each of the principal areas of laser devices and markets; to compare that against other extant reports that are available, and try to achieve a maximum of self-consistency within all the pieces of data that we have available to us. Obviously the optimal way to do this would be to go to every consumer of laser devices, but unfortunately, by the time such data were available, the market would have probably passed by by about eight years.
The outline of my talk involves three primary areas. First, an overview of current trends in the commercial laser scene. I want, in connection with that, to point to the fastest developing technologies areas. And finally to mention some of the technology as I see it that are on the horizon. I'm going to try to provide some sort of trend line of what's going on now, but I would be remiss if I didn't attempt to give you a broad view of what is going on across this whole spectrum of laser types.
During the past year, technical progress led to significant growth in the performance levels of several types of commercial lasers. In addition, virtually all segments of the laser industry recorded at least some improvements in the technology and in its applications. For the near term, laser-industry sources indicate continued rapid product development. Highlights of 1987 activities and examples of planned 1988 product launches make up the discussion that follows.
The intracavity optics market continues to keep pace with the laser industry. And like the laser industry, as it matures, its growth is slowing in all segments. Intracavity, or internal optics, include mirrors, prisms, beam splitters and Brewster windows. The optics external to the cavity are called beam handling optics, and include laser system optics for medical, industrial, entertainment and scietific applications. They make up 125 million dollars of the total laser optics market. The internal optics are about a 37 million dollar market at this time.
Good morning. I would like to thank Gary Forrest and Laser Focus for giving me the opportunity to participate in this seminar. After listening to Moe Levitt's overview of the industry outlook for 1988, it is a pleasure for me to represent one of the 'hot' sectors in the market - the old research market. My mission today is to provide a perspective of this market to you as one of the healthier parts of the industry, as one of the backbones of our industry.
I will admit to the fact that the title of talk was suggested, however, I do believe it is quite apropos. When we take a look at some of the market developments that we are seeing now, I think you will agree that perhaps the term 'exploding' is not inappropriately applied to the market.
Let me do a very quick review of the four basic types of optical recording, because there is an awful lot of confusion, not only in the marketplace but even within the industry. In this, I will also address, what kinds of lasers are being used now and some of the quantities of units that are already out there.
Proc. SPIE 0950, Special Presentation: Innovative Science And Technology Programs The Relationship Of Government-Sponsored Programs To The Laser Industry And Marketplace, 0000 (3 June 1988); doi: 10.1117/12.947548
The Office of Innovative Science and Technology is involved with the Strategic Defense Initiative Organization. This office, the Innovative Science and Technology office, is different from most research outfits within the Department of Defense, and quite frankly within the government. What we do is attempt, and I think we do more than attempt, we actually do it, we integrate the basic science engineering into a product. We don't separate out basic research, engineering research, product development, fabrication. we do it all together. We have an end goal in mind and we bring whatever basic engineering sciences that have to be brought to bear on that particular mission to come up with that product. Now the product that we come up with obviously fits the Department of Defense mission, and specifically the Strategic Defense Initiative Organization missions. Even so, those products have cut across many lines of application ranging from medical applications, all forms of commercial applications, you name it and it is there. If you look hard enough, and that is the problem ... knowing where to look.
The international industrial laser market. Dr. Levitt referred to this in his talk, and I think David Kales made some comments about it. It is in his annual report that there were some changes in the 1987 numbers. In Fig. 1, we see a total of about 2335 units. CO2 - 1400; Solid State - 900; Excimer - 35; a total of 2335. Now the column for the 1988 market. Those are Belforte Associates look at what we see the market to be. Notice that these numbers disagree somewhat with what David Kales reports in his January issue. Keep in mind that we have looked at this a lot sooner (or a lot later) than David did. This thing went to press in November, and we were still looking at this in late November. We have reflected some changes that came to us based on the market in Japan, which had a little uptick at the end of the year. A surprise to all of us. It was an uptick in Japan and a bit of an uptick in Europe, and those of you who read the press noticed that Spectra-Physics reported that they had a rather good year, and Coherent General for example told us that they had a pretty good last quarter of their year. All of this information came somewhat after the fact when the Laser Report information was put together. So I am reasonably confident that within a couple of a percent or something like that, these aren't all that bad of numbers for projections for 1988.
Depending on how you are positioned in the industry, it could be a good year for you, it could be a good next few years. There are some very nice projections into 1990 for certain areas. In other areas such as the ophthalmic market, certain segments of the ophthalmic market, there is notable decline, so it might be a time to reposition.
The topic the title is Military Market - An Exclusive Club or Major Market Opportunity? I think it really depends on your specific product. I know a lot of people view the military as being an exclusive club. I think some of the people who have had the opportunity to see Morely Safer and the 60 Minutes crew come into their office and talk to them about $600 toilet seat really wish they weren't members of that exclusive club. But I have worked in the military area, where I am kind of complementing what Dr. Ionson had to present earlier, except I am kind of on the other side of the fence. I have been a defense contractor for 11 years, so I have a little bit different point of view than the government does. But a lot of what I am saying tends to be a near-term market kind of approach rather than a longer-term sort of product development kind of information. But there certainly is, you are right, a lot of money in the government. This year's military budget is about $290 billion dollars, on the order of $80 billion of that goes into buying things. So there is a lot of money out there. What I am going to be talking about today is how much of that money goes into lasers. I am going to try to quantify it and also give a little bit of a qualitative estimate of where the trends are going, what is going to be the next lasers to be bought.
My topic is Japan, Threat or Opportunity. I hope to present you with some ideas on:
- How big the market is by product areas
- Who the players are in the market
- Who the competitors are (domestic and imports)
- Show some growth trends in various product areas
- The opportunity areas in industrial, scientific, medical, telecommunications, and others
- Where the strength areas of the Japanese manufacturers are
- What we would consider threat areas
- the semiconductor lasers, telecommunications, industrial and others.
What I would like to do is to really answer a question which most American companies find themselves wrestling with when they first start to consider the European market. That question is, "should one view Europe as a single entity, or as a collection of individual states?" Once you have answered that question, then from that is driven your whole marketing sales and distribution policy.