SAN JOSE, Calif., Feb. 23 /PRNewswire/ -- SDL, Inc. (Nasdaq: SDLI) and
Alcatel announced today that they will deliver high power 980 nm pump modules
for deployment in the latest generation of undersea communications networks.
The high power, high reliability, wavelength stabilized undersea pump modules
are built by Alcatel Optronic Division using semiconductor laser chips made by
SDL, Inc.  The resulting module will allow system designers to apply dense
wavelength division multiplexing (DWDM) technology to undersea communications
networks to meet the ever-increasing need for telecommunications and Internet
traffic bandwidth.
    Pump modules are a key component powering optical amplifiers used in DWDM
fiber optic communication networks.  High power pump modules operating in the
980 nm wavelength range offer significant system cost and performance benefits
compared to components previously used in undersea networks.  This new
generation of pump modules introduces less noise on signals propagating
through the optical amplifiers.  This low noise characteristic effectively
increases the available transmission bandwidth of a fiber optic network.  The
same characteristic can be used to increase the fiber optic span length
between amplifiers, resulting in significantly lower network capital costs.
    Alcatel's optical amplifiers using SDL's 980 nm pump lasers have been
successfully deployed for several years in terrestrial fiber optic networks.
Only recently have these devices demonstrated the exceptional reliability
required for use in undersea networks.  Alcatel and SDL have worked closely
for more than a year to ensure that the performance and reliability of these
modules meet or exceed the requirements of the latest generation of undersea
fiber optic networks.  The culmination of this cooperative effort was an
exclusive four-year agreement between Alcatel and SDL for the supply of 980 nm
laser chips for use in pump modules for underseas markets.  A production ramp
in the first quarter of 1999 is underway.
    "Alcatel's extensive experience in the design and manufacture of submarine
qualified components has been a powerful complement to SDL's world renowned
high power laser chip technology," said Jean-Marie Vansteenkiste, chairman and
chief executive officer of Alcatel Optoelectronic activity.  "In fact, we have
exceeded some of our initial performance targets with enough margin to enable
additional network performance benefits.  We believe we can now offer the
highest level of power and reliability available in the undersea market."
    The pump module design also features passive wavelength stabilization, a
critical performance requirement for wide bandwidth DWDM optical amplifiers.
Variations in pump wavelength can cause changes in the amplification
experienced by different signal channels transmitted by an optical amplifier.
Such variations can seriously degrade system performance and are, therefore,
undesirable in DWDM amplifiers.  SDL has optimized the laser chip and grating
design to stabilize the laser wavelength and thereby maximize pump module
performance.  According to Donald R. Scifres, SDL's chairman and chief
executive officer, "We are very encouraged that our high power grating
stabilized laser appears to deliver the best combination of performance,
reliability and manufacturability.  The close cooperation between Alcatel and
SDL for this program resulted in a combination of product performance and time
to market that could not be achieved by either company alone.  This
partnership and contract is part of our ongoing strategy to capitalize on our
technology by providing large telecommunications companies with leading edge
products to boost throughput on their networks."
    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 company's ability to successfully ramp up production to meet customer
demands, and the ability of the company's high power grating stabilized laser
to deliver the best combination of performance, reliability, manufacturability
and time to market.  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 uncertainties in the actual performance, reliability, and
manufacturability of the product, delays or cancellation of the orders,
inability to successfully ramp production, 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 for the year ended December 31, 1997, and quarterly
reports on Forms 10-Q for the first three quarters of 1998.
    SDL designs, manufactures and markets fiber optic related products, lasers
and optoelectronic based systems.  The company's products are used in a
diversity of markets such as telecommunications, cable television, dense
wavelength division multiplexing, satellite communications, printing, medical,
and materials processing markets.

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