With all the movement in the industry, we also have to look at the overall structure of the industry providers. In the early stages of the optical networks, carriers and manufacturers emerged. These providers were poised to build on the existing technologies and increase the capacity, drive new demand, and innovate wherever possible. However, the market heated up so quickly that many of the stodgy manufacturers were caught with their trunks down. They simply did not have the capacity in their trunking systems, nor were major capacity improvements on the horizon. Consequently, a new feeding frenzy began. In 1998, the industry was thrust into a major reeling under the inexplicable demands it had not anticipated. Thus the stage was set for the acquisitions and merger mania that followed. In the year 1999-2000, the amount of activity exceeded US$110 billion in acquisitions (representing $25 billion in 1999 and $85 billion through October 2000). This is shown in Figure 7-5. Table 7-4 is a more detailed listing of the action with the buyer, the company it bought, and the valuation of the company. This is not an all-inclusive list, but it represents many of the larger transactions that took place over these two years.

Figure 7-5: The value of acquisitions and mergers in 1999-2000