Industry Spotlight: Precision OT’s Keith Habberfield Looks Ahead 

May 30th, 2023 by · Leave a Comment

The biggest vendor names in the network space are those who provide the optical platforms and routers.  But in between those areas at the intersection of different vendors, technologies, and designs there has long been space for independent innovation.  One company making its play there in recent years is Precision OT, which focuses on transceivers and related passive components.  With us today to talk about their approach, new tech like 400G ZR, and today’s supply chain ecosystem is Keith Habberfield, SVP of Sales & Marketing for Precision OT.  Keith joined the company three years ago after stints at CommScope, Comcast and Adelphia.  

TR: What are the origins of Precision OT, and how did it get to where we are today?        

KH: Precision OT was founded over 10 years ago in Brockport, NY. The company set out to address gaps in how network operators consume transceivers and fiber. Since then, we’ve been shipping active and passive optical components to customers around the world. Our growth has accelerated significantly over the last five years. It has been amazing to see.    

TR: What types of customers do you focus on, what components do you offer them, and how do they fit in with the other optical gear we hear about them deploying? 

KH: Our products cater to a wide range of industry verticals from cable operators, telcos and data centers all the way to healthcare and government. We also sell passive optical components including mux/de-mux modules, rack mount gear, fiber jumpers and more. For transceivers, it all boils down to interoperability and quality. You have the operating systems from major NEM’s – and at the dawn of the internet these companies created their own proprietary optics. That meant you ended up with a bookended solution. If you bought one device from one of those vendors, you had to buy another to pass data the other way. After complaints of vendor-lock, the multi-supplier agreement was created. Essentially, that enabled the ability to program a transceiver to work with any NEM at the component level.  This accelerated adoption with the transceiver being the common ground. 

TR: What role does the transceiver itself play? 

KH: A transceiver is basically an electrical/optical media converter. Electricity can’t go very far without retransmission. This is where light comes in, as it can span much longer distances. The transceiver has the ability to take the electrical signals from a router/switch, convert them to light signals, send them across a fiber optic cable, and then transfer the data packets back to electrical signals on the receiving side of the connection. 

TR: What opportunity in that ecosystem was Precision OT founded to solve? 

KH: We saw the opportunity and need to provide not only a product, but also the necessary systems integration expertise required to support our customer-base and their intricate networks. For us, it is more than just providing a product. We pride ourselves on our competency and building meaningful relationships with our customers.  

TR: How do the passive component products you have introduced fit in? 

KH:  Passive components are relatively new to our product offering, but they are a significant step towards our commitment to provide full end-to-end optical solutions. These components are what I like to call a customized commodity. Network operators utilize unique network design, operate over certain wavelengths and even have physical requirements for the position of connections within a rack. As a result, we see the need for customized MUX/DEMUX modules to ensure that they can easily and seamlessly be installed within a customer’s network along side existing infrastructure.  

TR: How do you approach that customization with a customer? 

KH: We’ll host a design session with our customer. We pull together drawings, review those with our customer’s engineering and operations teams, create a prototype, provide a sample and make sure everything works from a form-fit-functionality perspective. After they validate and approve it, we start mass production. 

TR: Where is Precision OT investing its resources this year? 

KH: We are continuing to invest in expanding our passive product range. We’re also investing in our R&D efforts. Expect to see some exciting new announcements this year for net-new, first-to-market products from us.   

TR: How do you reach customers? 

KH: Historically, we’ve been direct-to-customer, but we recently introduced our Distributor Alliance Program, which added a few highly trusted partners to serve as extensions of our Sales and Marketing Team. These partners can help carry the brand worldwide, both for niche markets and high-volume, competitive markets. Our vetted resellers have strong industry relationships experience to help evangelize our brand and drive sales.   

TR: Geographically, what markets are you focused on and where do you build your products?  

KH: We are headquartered here in the US but have quickly expanded globally. Two years ago, we opened our office in Europe, and late last year we opened our office in Canada. We also have a subsidiary in Brazil. In terms of manufacturing, we are fab-less.  We do the design and hand it off to our contract manufacturers who specialize in that function.  

TR: Given that, how have supply chain disruptions over the past three years affected your growth? 

KH: We keep a large multi-million-dollar inventory at all times, so for us, we were not very negatively impacted by supply chain disruptions. During the pandemic, I think we only ever got tight on two individual products. During this time, we proved to ourselves that trusting in your own internal forecast and making buying decisions based on it is a far better financial play than relying on just-in-time shipping.   

TR: Do you feel that era of supply chain unpleasantness is over? 

KH: Well, in some cases we have seen an over-rotation where customers are over-inventoried, but I believe that will level out in a quarter or two. I don’t think the era is over, though. I think that at any moment the slightest little jiggle of the handle could disrupt things again. I’m not confident that we as an industry have necessarily learned too much. From our perspective, we are looking out further than we ever have, and I really hope that other vendors are doing that, too. 

TR: What upcoming trends do you see in the way network operators build their networks? 

KH: I think the biggest sort of technology shift that we’re ‘elbow deep’ in is probably 400G ZR.  In the past, you had optical engineering, which corresponds to the transport layer.  And then you had IP engineering, which is layer 3 and higher. 400G ZR pulls the two together in a transceiver, closer than ever been before. The motivation behind it is that from a CAPEX perspective it’s more economical and supports things like point to multipoint. It’s more flexible overall. We have been very busy doing designs for our customers and taking them through the pros and cons of 400G ZR, and it looks like it’s shaping up to have a significant impact on how networks of the future are architected.  

TR: What stage is 400G ZR at in the market today? 

KH: We have 400G ZR solutions available right now and more that we are working on. There are a number of different variants to it.  They can be link-budget or power-driven and can support multiple data rates. There isn’t really a network operator that we’ve talked to that isn’t looking very hard at this. 

TR: In what timeframe to you see the industry rolling this out?  Where will we see it? 

KH: We will definitely see early adopters this year. Depending on their successes, we will see it used in both a transport-heavy deployment and in networks that hop from island to island like the Caribbean as an example.  

TR: How do you expect that to impact the overall ecosystem? Will it hurt the big box vendors? 

KH: Possibly, it’s disruptive and although some of them are choosing to offer their own solution, it could drive business model changes for them. Especially around licensing an “alien wavelength” through their system. For now, that licensing fee is a similar cost to buying a line through them. I don’t know how long that holds up, honestly. I think ultimately the operators are going to force the transport folks to start turning on the idea of paying for the solution that way.  It really all depends on how operators start deploying it.  I mentioned before that there are whole network organizations that are built around transport and IP, and it’s the same sort of situation in the vendor ecosystem.  There are going to be winners and losers based on who decides to embrace it, who decides to take the ‘Kodak’ digital camera approach and try to ignore it, and who does things in their business model to restrict it. It’s hard to say which one of those is going to work out but based on the level of interest we’ve seen I think it’s certainly going to change business models. Hopefully we’ll be supporting a lot of it. 

TR: Thank you for talking with Telecom Ramblings! 

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Categories: Fiber Networks · Industry Spotlight · Telecom Equipment

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