Program of May 14, 2008

A nearly packed house of retirees and guests got a solid look at the company's revitalized telecommunications business. Our speaker was Marty Curran, Sr. VP and GM – Corning Optical Fiber, who told his audience that the success – or comeback – of the company's telecom business is an “excellent example of Corning engineering”...the result of a total engineering approach, recognition of opportunities (through expanded access), and business and product innovation – especially the development of ClearCurve™ optical fiber.

Curran reviewed this business segment and its growth from optical fiber development, innovation and improvement through Corning cable systems and related hardware and equipment. Taken in combination, this growth provides the company with access to an ever-expanding market.

ClearCurve fiber, the main ingredient in this success is followed closely by the development of related hardware and equipment. Together, they are the elements key to success in accessing the telecom market.

For example, Curran noted we use optical fiber whenever we make a long-distance phone call, watch television, surf the Internet or send e-mail. “Thats been the case for the past 10 years,” he said.. To do all this worldwide takes 1 billion kilometers of optical fiber...equivalent to three round trips to the sun.

The information-carrying capacity of fiber relative to copper is tremendous...27 grams of fiber can carry the same amount of information as 880 tons of copper over a distance of 1 kilometer. That fact alone represents a tremendous impact on a “greener” globe...less material translates to less energy consumption in cable manufacturing.

Curran said the company has come a long way since 1970 when Drs. Robert Maurer, Peter Schultz and Donald Keck startled the telecommunications world with word they had successfully measured loss levels below 19 decibels per kilometer in fibers made at Corning's Sullivan Park. From that discovery came a series of innovations as well as expansions and investments in production, cabling and interfaces. It was boom time for fiber that went bust when it was brought up short in the telecom bubble burst of the late 1990's.

Still confident in the promise that fiber held for global telecommunications, the company continued its work in fiber development with an eye to providing stability and balance for the future. That was done through growth in global innovation. “Our targets for stability were: generate adequate cash flow to enable investments in growth; assure our costs were in line with revenues; and have a consistency to see us through (business) downturns. For balance, we drove to outperform our peers and maintain leadership in the fiber industry, capture new opportunities in both volume and innovation, and maintain a long-term outlook based on sustainable profitability,” he said, adding, “We have done that.”

Today, Corning makes fiber in the US (Wilmington and Concord, NC) and in Shanghai, China, where we have 100% ownership and where we are expanding capacity. Our fibers today provide optical products that apply to every current and projected application. These include:

long haul and short hall submarine cable and ultra-low loss (ULL) and LEAF fiber for long distance transmissions over land, as well as fibers specially designed for metropolitan and to-the-premises applications.

Curran presented a series of visuals showing ClearCurve cable's ability to withstand the tight bends and rough handling – even to power stapling – in the construction of homes, condos and multi-unit complexes. “The people installing fiber in buildings today have a better handle on how to install fiber optic cables. He added that North America represents one-quarter of the world fiber optic cable market and that our market volume has surpassed the pre-bubble production levels of 1999-2000.

Today, the company's telecom business includes optical fiber manufacturing as well as optical fiber cabling, and the hardware and equipment that enable complete fiber optic systems. Products coming out of Hickory include Ribbon Armored Cable, gel-free cable, interlock armor cable, ribbon cable and indoor cables – a range that meets both public and private network needs. Curran said Corning Cable Systems' hardware and equipment segment provides “tip-to-tip connectivity to produce complete optical fiber systems for a range of private networks that include connectors, fiber hardware and cable assembly, splice equipment and testing, fiber optical terminals.

Through CCS, we serve two market segments – public and private. The public networks are the telephone companies, cable TV, and wireless service providers, utility companies and OEMs. The private segment consists of businesses, industries, hospitals, universities and various data (financial, Internet, etc.) centers. It also includes intra-building, inter-building, floor-to-floor and fiber-to-desk applications for all users of telecom and information services.

In summary, Curran said Corning's fiber optic systems and innovations span the whole telecom network . “To keep ahead of the curve, so to speak, we continue to address the industry's need for speed and ease of fiber deployment through highly bend-tolerant fiber, robust drop-cable products and field-installable connectors...all of which make fiber handle like copper while far surpassing copper's transmission capabilities.

The market opportunity is huge, especially in existing 680 million multi-dwelling units (MDUs) such as condos, housing developments and apartment buildings. MDUs represent the majority of urban living units and government-backed broadband initiatives are expected to grow this market by more than 10 million units per year by 2012.

Curran said this approach of taking a basic element (fiber) all the way to integrated cable and hardware telecom solutions adds value and margin at every level...from fiber and cable through connectors and splicers, cable assemblies and fiber hardware to integrated cable and hardware solutions. That kind of forward integration is not new with Corning.

After his PowerPoint presentation, Curran answered questions from the audience.

Q - What's our relationship with Siecor?

A – Corning bought out Siemens' interest and Siecor is now a wholly-owned Corning unit in Hickory.

Q - What's the status of our photonics business (that went South in the telecom bubble burst)?

A - The Photonics business was divested to Avanex..

Q - What's our competition?

A - We do have competition in Japan and Europe. We are the world leader in cable, but some locals put up a good fight. The weak US Dollar is good for us; it improves our sales abroad.

Q - As we've come back, have we done any more consolidation?

A - Not much, to our own surprise. We did do a joint venture with the Japanese, but we're more focused on growth from within.

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