Big Firms Back Co-Packaged Optics

Co-packaged optics is the ultimate direction for the long-touted “optical integration” meme. In theory, co-packaged optics wraps up active optics and active electronics wrapped to avoid the thermal/power inefficiencies inherent in conventional approaches to high-speed optoelectronics. A few years back when CIR investigated which technology platforms would take data centers into the 400/800G era, we were told pluggables would persist for a while, then would come on-board optics (OBO) and then – at some distant time in the future – would come co-packaged optics. Better not to worry about co-packaged optics, they said.

What we are hearing now is different.  In this new view of things, co-packaged optics continues to compete with conventional pluggable optics, but OBO is now seen (at best) as an interim technology.  What changed?  We think it was the recognition that co-packaged optics has a broad market covering the next thrust of optical networking (data centers, metro and edge), as well as high-performance computing, sensors, aerospace interconnects, and storage systems that brought co-packaged optics to the fore.  In other words, the revenue potential for co-packaged is quite significant in a way that it might be hard to attribute to OBO and impossible to attribute to pluggable optics

The potential for co-packaged optics is still somewhat under the radar.  The trade press has yet to fill its front pages with co-packaged optics stories.  However, what we offer as partial proof is that some large and famous public companies – some big names — are already involved.  Here we can cite IBM, TE Connectivity, SENKO and Intel. To this list we can add Microsoft and Facebook, the founders of the Co-packaged Optics Collaboration.

Today we can count six public companies pursuing important roles in the co-packaged optics story.  We do not think such companies would be bothering if Co-packaged optics was a matter of little importance.

Facebook:  Surprisingly perhaps, Facebook has built its own equipment before and now, together with Microsoft, has formed the Co-packaged Optics Collaboration to spread the Co-packaged word to large end users in the cloud provider universe.

IBM:  IBM was the first firm to co-package optical engines with switching ASICs, as part of a DARPA-funded supercomputer project in 2004-2008 and is using co-packaged optics in the ARPA-E ENLIGHTENED project to create improved energy efficiency in optical networks.  Others in this project are using silicon photonics solutions.  IBM is also touting its V-groove manufacturing technology as part of its co-packaging efforts.

Intel:  Reportedly, Intel has four large customers already evaluating the new co-packaged switch.  The company expects to have a 51.2 T switch by the second half of 2023 ready to go into a co-packaged environment.

Microsoft:  The other founding member of the Co-packaged Optics Collaboration along with Facebook.  Future members of the Collaboration will also be major cloud providers.

SENKO:  Giant Japanese conglomerate.  Its components group offers fiber-optic connectivity solutions for Co-Packaged Optics equipment designs

TE Connectivity: Originally a force to be reckoned with in the OBO space, but withdrew.  Currently TE Connectivity has a fine pitch co-packaged socket technology, which is already being utilized in early co-packaged products

This list of large companies in the co-packaged optics space shown above is impressive and indicates that co-packaged optics, CIR believes, should be taken seriously. Yet, pluggable optics should not be discounted. It is beloved of an entire generation of network managers.  We expect that data center managers will hedge their bets and employ a fair amount of pluggables in their networks until co-packaged products have proven themselves. As for OBO it may be no more than an interim technology, if that.

In our next blog we will pinpoint they key opportunities for co-packaged optics and how firms both large and start ups are already developing them.

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