CTO Frank Smyth and colleagues were at Los Angeles last week to attend and exhibit at Optical Fiber Communication Conference (OFC). Here are his thoughts and analysis of the latest market innovations in datacenters.
By now I have had a chance to take stock and gather my thoughts post-OFC. Last year was all momentum and excitement around AI-driven demand. This year, that demand was still there, likely even stronger, but there was also a shift in tone. People were starting to worry about supply chains, capacity, and the industry's ability to meet the demand. That worry is also a motivator. As two of the largest suppliers in the industry see huge investment from Nvidia to secure capacity, it creates an opportunity for smaller players like Pilot Photonics to have an impact.
The scale being discussed is extraordinary. As the industry moves from the 51.2T to 102T switches, and as optics starts to move into the scale-up portion of the network, Andy Bechtelsheim noted "whatever number you are thinking of, it isn't high enough.” He also did give a number: there soon may be demand for a billion optical links annually, and that is a huge increase over what the industry currently delivers.
At the Optica Executive Forum, a huge theme was the emergence of “scale-across” networking as a major category. There are some differences in definition across the major players, but generally it refers to the neworking of AI datacentres across geographically distributed sites. This is necessary, because there simply isn't enough power and resources available to locate them all at a single site. Last year I highlighted the Meta Hyperion datacentre, which is a 5GW beast with a footprint nearly the size of Manhattan. Scale-across is akin to DCI for traditional cloud datacentre networks, but with additional AI-specific network constraints around latency, traffic patterns, and so on. Coherent, coherent-lite, and IM/DD are all expected to feature in the scale-across segment depending on reach, power, and cost requirements.
In the scale-out domain, the XPO MSA was probably the most significant announcement. A 12.8 Tbps, 64-channel (up to 200G/lane) pluggable with integrated liquid cooling up to around 400W, it is designed to prolong the reign of pluggable optics. It targets two constraints that have been pushing the industry toward co-packaged optics: power density and thermal management. While some of the biggest and most vertically integrated players will continue the march towards CPO, XPO may shift the timeline and slow down the transition away from pluggables for others. With 4X the density of OSFP pluggables, it is an extremely impressive feat and maintains the operational advantages of pluggables in terms of serviceability and ecosystem.
There were two further MSAs announced: Optical Compute Interconnect, which focussed on Optical I/O-type board and package level connectivity in the scale-up, and Open CPX, which aims to standardise CPO-type archiectures in the scale-out. Furthermore, the Advanced Photonics Coalition (APC) is growing in parallel and it plays a similar role at a different layer. APC is focused on CPO but from a supply chain and manufacturing perspective. We are on of the most recent members, along with Microsoft and Lightium.
An open question is what happens as workloads become more dynamic. Inference and agentic AI introduces a very different traffic profile: more bursty, less predictable, more fragmented. Optical circuit switching today operates at fibre-level granularity with relatively slow reconfiguration, which makes it powerful but not agile enough to fully support these types of flows and extract maximum efficiency from underutilised XPUs. A faster and more granular level of optical switching will likely emerge to complement today's OCS, and there are several players emerging in this space. Finchetto is one we are particularly excited about, since they have chosen to develop their packet-level switch with our nano-second tunable laser.
Another theme that came up repeatedly in conversations was the need for O-band tunable lasers to support the AI datacentre market boom, both through test & measurement and now, more and more, for network monitoring. C-band is the traditional choice for telecom, and as datacentre networks become larger, more complex, and demand higher reliability, monitoring starts to matter more. That naturally drives demand for agile tunable lasers in the O-band.
It is an exciting time. Opportunities are all around as more advanced laser sources are needed to enable the Everything over Optical era. As always, OFC was both hugely exciting and quite tiring. In one evening, there was an EPIC networking session, another by PhotonDelta, the OFC rock concert, and an investors event at a craft brewery. It is nice to now be able to take stock, absorb the latest information and trends, double down on existing opportunities, and position for newly emerging ones.
What’s more, we found where the best pint of Guinness can be had in LA. Damian spent a lot of time researching this, and it was St Patrick’s day, so luck was on our side. It was as good a pint as you could get back home. Well, just about.
Drop by The Liberties bar at City West. Tell them Pilot sent you.