Functionality and integration are rising, while cost and size are dropping to satisfy communications needs. Integrated optics products that are finding widespread commercial application include lithium niobate modulators and passive waveguide devices using silica on silicon, ion-exchanged glass, or polymer on silicon material systems. Overall trends will be toward higher levels of integration and more functionality on a single chip. In addition, significant advances will be made to decrease component size and cost, enabling new market opportunities for this technology. Since 1995, lithium niobate modulators have found widespread application in high-end cable television and OC-48 communications systems. More than 100,000 components have been fielded to date with FIT rates (failures in 109 s) of less than 50.