Beyond all of the hype and tumult, market drivers and technological developments are converging to ensure a bright future for Si photonics.
THOUGH THE SI PHOTONICS MARKET HAS JUST KICKED OFF, VOLUME PRODUCTION IS ALREADY CLOSE
Big data is getting bigger by the second, and transporting it with existing technologies will push the limits of power consumption, density and weight. Yole Développement analysts are convinced that photons will replace electrons, and that Si photonics will be the mid-term platform to assist this transition.
Si photonics offers the advantages of silicon technology: low cost, higher integration, more embedded functionalities and higher interconnect density. It also provides two other key advantages:
1. Low power consumption: particularly when compared to copper-based solutions, which are expensive and require high electrical consumption.
2. Reliability: especially important for data centers, where a typical rack server’s lifespan is two years before replacement.
Back in 2006, VOA were the market’s first Si photonics products. Today, there are still a few Si photonics products on the market (i.e. VOA, AOC and transceivers from Luxtera, Kotura/Mellanox and Cisco/Lightwire) but big companies (i.e. Intel, HP and IBM) are close to realizing silicon photonics products. Yole Développement also sees big OEMs such as Facebook, Google and Amazon developing their own optical data center technology in partnership with chip firms (such as Facebook with Intel).
In this report Yole Développement shows that, in the short-term, silicon photonics will be the platform solution for future high-power, high-bandwidth data centers. Silicon photonics chips will be deployed in high-speed signal transmission systems, which greatly exceed copper cabling’s capabilities, i.e. for data centers and high-performance computing (HPC). As silicon photonics evolves and chips become more sophisticated, we expect the technology to be used more often in processing tasks such as interconnecting multiple cores within processor chips to boost access to shared cache and busses.
Analysts also analyzed silicon photonics’ chances of being used for telecom, consumer, medical and biosensors applications, compared with competing technologies.
ACQUISITIONS AND CONSOLIDATIONS ARE ONGOING
Yole Développement estimates that almost US$1B has been spent in the past three years on Si photonics companies’ acquisitions.
Not surprising, considering that silicon photonics is seen as the optical technology that will leverage future bottlenecks for interconnects in data centers and HPCs at short-term.
The main motivations for acquisitions are:
To handle increasing traffic in data centers
To strengthen a company’s portfolio in 40GB and 100GB optical engines
Acquisitions are generally made by module/system makers as a means of enlarging their technologies portfolio, since this is a faster, cheaper route than R&D investments. We also see big players such as Intel taking both approaches (acquisitions and R&D), while others have decided not to invest in silicon photonics since they think future designs will be accessible via foundry services. In fact, many IC foundries have started proposing Si photonics wafer foundry services, so this could create additional acquisition opportunities in the near future.
TECHNICAL CHOICES AND NEW OPPORTUNITIES
Silicon photonics is an exciting field that mixes optics, CMOS, MEMS and 3D stacking technologies. Over the past several years, it’s become clear that some technical choices will be better than others for successful commercial development:
Light source is a big integration challenge. As silicon laser is probably years away from realization, the different approaches are likely to be either attached laser (i.e. Luxtera) or (InP) wafer-to-wafer/die-to-wafer bonding, followed by post-processing (i.e. Intel or Leti).
Yole Développement has also seen a shift from monolithic integration for electronic/photonic-to-hybrid integration, since critical dimensions are very different. Today, the favored approach seems to be two-chip hybrid integration (the Cu-pillar from STMicroelectronics, for example), since semiconductors’ and photonics’ critical dimensions are likely to be at least one order of magnitude different.
The fiber choice: multi-mode versus single mode is also on the table.
Silicon photonics is a business opportunity for different player types: OSATs, MEMS firms, semiconductors companies, etc., because it involves different challenges for packaging, optical alignment and electronics integration. The need for very diverse technologies creates a need for different packaging/micro-machining/manufacturing approaches.
A TURNING POINT IS EXPECTED IN 2018
In this report, Yole Développement analysts forecast the Si photonics market for four different applications: HPC, future-generation optical data centers, telecom and others (including sensors, medical and consumer).
They looked at the following modules/devices: transceivers (for AOCs) and embedded optics (from mid-board optics to interposers to intra-chip interconnects), and forecasts have been calculated in US$M, millions of units and wafer starts. They estimate that the silicon photonics device market will grow from around US$25M in 2013 to more than US$700M in 2024, at a 38% CAGR. In 2018, emerging optical data centers from big Internet companies (Google, Facebook, etc.) will trigger this market growth.
Non-datacom/telecom will only have a small portion of market value since these applications are still far from market maturity. However, we’re at a turning point where the market is increasing again and Intel, which is very active in this field, could contribute to a quick ramp-up of Si photonics.
Updated industrial status and supply chain for silicon photonics