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SDL Awarded Contract Extension from Alcatel for Supply of 980 nm Pump Chips For Use in Undersea Networks Through Year 2003

   High Reliability Chips from SDL Enable Increasing Use of DWDM to Expand
              Telecommunications and Internet Traffic Bandwidth

    SAN JOSE, Calif., Jan. 31 /PRNewswire/ -- SDL, Inc. (Nasdaq: SDLI) has
reached an agreement with Alcatel Optronics to extend an existing multi-year
agreement for the supply of 980 nm laser chips and fiber Bragg gratings up to
the year 2003.  The agreement covers supply of 980 nm laser chips and fiber
Bragg gratings used in pump modules manufactured by Alcatel Optronics for use
in undersea fiber optic networks.  The extended agreement follows the
successful joint qualification and production ramp of these chips announced in
August 1999.  A significant feature of the extended agreement covers the next
generation of the SDL 980 nm chip, the 6540 Series, continuing the successful
collaboration of the two firms to produce the highest performance pump modules
for undersea DWDM networks.  The new pump module will be capable of powers
exceeding 180 mW and will be available later this year.
    According to Michael Staskus, Product Line Manager of SDL, "This agreement
confirms SDL's market leadership in this product segment and further validates
our successful strategy of close collaboration with the leading customers in
each market segment.  The market for undersea fiber optic components is one of
the fastest growing, yet most demanding segments in the industry.  Our focus
on quality, performance and volume production continues to support the rapid
development and deployment by our customers of networks with ever increasing
bandwidth on land or underseas."
    Gerald Chretien, Product Line Manager at Alcatel Optics states, "Alcatel
Optics is the world leader in submarine transmission.  Thanks to the high
performance and reliability of the Alcatel 1998 SMG pump module manufactured
by Alcatel using the SDL's chip, transoceanic links are now capable of Terabit
per second transmission.  The extension of our collaboration will allow us to
double the power available from the pump module, leading to the highest
capacity ever reached for a commercial submerged link."
    SDL's products power the transmission of data, voice and Internet
information over fiber optic networks to meet the needs of telecommunications,
dense wavelength division multiplexing (DWDM), cable television and satellite
communications applications.  They enable customers to meet the bandwidth
needs of increasing Internet, data, video and voice traffic by expanding their
fiber optic communications networks much more quickly and efficiently than
would be possible using conventional electronic and optical technologies.
SDL's optical products also serve a variety of non-communications
applications, including materials processing and printing.  Additional
information about SDL, Inc. is available on the Internet at http://www.sdli.com .

    About Alcatel
    A world leader in telecommunications systems and equipment, as well as
related cables and components activities, Alcatel operates in over 130
countries.  Alcatel provides complete solutions and services to operators,
service providers, enterprises and consumers, ranging from backbone networks
to user terminals.  For more information, visit Alcatel on the Internet:
http://www.alcatel.com .
    The optronics business unit of Alcatel, markets a full range of
optoelectronic devices and solutions for fiber optic communications.
Operating state-of-the-art manufacturing plants in France, it is a leading
supplier of high performance laser and photo detector modules, optical
amplifiers and other integrated optoelectronic modules with particular
emphasis on components for high bit-rate and DWDM systems.

    Statements in this press release which are not historical including
statements regarding SDL's or management's intentions, hopes, beliefs,
expectations, representations, projections, plans or predictions of the future
are forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995.  Such statements include statements regarding
the rapid development and deployment of land and undersea networks with ever
increasing bandwidth, the power capability of the 980 nm module, the Company's
market share leadership, and the Company's focus on quality, performance and
volume production.  It is important to note that the Company's actual results
could differ materially from those in any such forward-looking statements.
Factors that could cause actual results to differ materially include risks
related to manufacturing processes and capacity, yield fluctuations, the
Company's inability to achieve the expected performance levels, a decrease in
the anticipated market development and deployment of land and undersea
networks, and the risk factors listed from time to time in the Company's SEC
reports including but not limited to, the annual report on Form 10-K and
10-K/A for the year ended January 1, 1999, and the quarterly report on Forms
10-Q for the quarters ended March 31, June 30 and September 30, 1999.
    For more information on SDL, Inc. at no cost, please call 800-PRO-INFO
(U.S.) or 732-544-2850 (Int'l), ticker SDLI.


SOURCE SDL, Inc.




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  • http://www.sdli.com
    CONTACT:
    Donald R. Scifres, Chairman and CEO, or
    Michael L. Foster, VP Finance and CFO, of SDL, Inc.,
    408-943-9411; or general, Lisa Horn Chainey, investors, Susan
    Katz, or media, Scott Marx, of The Financial Relations Board,
    415-986-1591