With revenue increasing for 100Gbit/s optical modules and components, and developments well advanced for the highly integrated 25 Gbit/s optical and silicon components needed for the next generation of modules, companies are starting to ramp investment in 400G. We are seeing these 400G developments across the industry, including long-haul, metro, and datacenter and from small, medium, and large companies. The enthusiasm for 400G and the dollars to pay for this investment is largely driven by the revenue these companies are already receiving for 100G.

Now 100G networking is entering the mainstream market. Most large switches and routers already support 100Gbit/s interfaces, and the number of ports per line card has increased from two to eight over the last two years. Also, 100G is becoming widely deployed in the long-haul network, and the coherent receiver technology developed for long-haul applications is becoming available for shorter-reach metro applications. Investment in 40Gbit/s links is shrinking, since the cost per Mbit/s is now lower for 100G.

QSFP+ and CXP optical modules and active cables are available from many vendors for very short-reach 40Gbit/s and 100Gbit/s links in data centers. These will be joined by 100Gbit/s QSFP28 optical modules and active cables in 2014. The first generation of pluggable 100Gbit/s optical modules for longer distances manufactured to the CFP specification are available from 14 vendors. The first of the smaller CFP2 modules are shipping. CFP2 is likely to be a short-term solution, since the next-generation CFP4 modules are half the width. Finisar gave the first public demonstration of a CFP4 module in September 2013. We expect the first CFP4 modules to be shipping in 2014.

The first 100Gbit/s optical modules used 10x10Gbit/s optics and electrical interfaces. The industry is moving to 4x25Gbit/s for both electrical interfaces and optics. At the same time, the industry has developed more advanced modulation technologies for long-haul and now metro links. These developments have been made possible by the significant investment by device vendors in high-speed serial technology, integrated silicon and optical technologies, and digital signal processing (DSP). The result is a huge range of 100Gbit/s devices, including gearboxes, coherent receivers, driver/receiver arrays, transceivers, and CDRs.

The trend across the 100G market is greater component integration, lower power consumption, smaller optical modules, and higher port density. These developments are dramatically reducing the cost per port for 100G and commoditizing technologies that will be applied to 400G in the future.

For more insight into developments in 100Gbit/s and 400Gbit/s networking, see Heavy Reading's recent report, 40/100Gbit/s Optical Modules & Components: A Heavy Reading Competitive Analysis. This report identifies the full spectrum of vendors developing 40/100Gbit/s optical modules and components, and provides critical analysis of the overall market and ecosystem for 40G, 100G, and 400G technologies.

— Simon Stanley, Analyst, Heavy Reading