Post-ECOC 2019: Optical Networking Beyond the Thunderdome

Column James Kisner, Contributing columnist 10/14/2019

Silicon photonics and technology change march on
One data point flying amongst investors at ECOC was that Intel was finally making money on its silicon photonics transceivers -- a major milestone that, if true, would suggest Intel may have more staying power in the market than incumbents recognize. Also worth noting, we learned that silicon photonics-based startup Skorpios is in production with 100G QSF28 transceivers and is on the approved vendor list at Cisco. Additionally, Alibaba's 400G DR design is using silicon photonics technology from Elenion Technologies.

VCSELs and copper still have legs
Dust Photonics, a company focused on VCSEL-based announced a $25 million investment from Intel Capital. Finisar (now II-VI), at ECOC, demoed a 100G PAM4 VCSEL. Credo was also on hand demoing its 100Gbit/s and 400Gbit/s HiWire Active Electric Cables (AECs). It seems Credo is determined to not let copper die between the server and top-of-rack switch.

400G ZR is poised to disrupt the optical systems market
Iphi is sticking to its public timeline of delivering 400G ZR samples by year-end. At the show, NEL and Acacia announced testing to demonstrate interoperability between OpenZR+ coherent modules for reaches beyond 120km. Recall, at last year's show, Andy Bechtelsheim made a splash in his announcement of Arista's support for a higher-powered "ZR+" variant of 400G ZR modules to reach up to 1000km. He noted at that time that all of both the continental US and Europe could be interconnected with 400G ZR+ modules between switches and routers without a dedicated optical network layer.

Infinera wants to disrupt transceivers, too
Potentially adding insult to injury, optical systems vendor Infinera announced coherent-based "XR Optics" that it claims could lead to the cutting of the number of optical transceivers needed for mobile "X-haul" applications by half. Of course, like similar disruptive solutions offered by Infinera in the past, it requires what is ultimately a proprietary solution from Infinera, even if it's housed in a transceiver assembled by someone else.

Given all that is happening in the optical industry, it's hard to keep a level head. At this point I think some vendors may feel like Tom Hardy's version of Mad Max in Fury Road, strapped to the front of a big truck as a source of blood for its customers.

via GIPHY

The good news is, unlike the world of Mad Max, it's fair to say that the world of optical communications is far from ending; optics continue to take share from copper, and bandwidth growth in networks continues unabated. Even in the cut-throat Ethernet optical transceiver market, LightCounting is forecasting a 22% CAGR over 2019 to 2024 driven by sales of next generation products and continuing demand for 100GbE Optics.

So buck up, optical friends. Perhaps, as Tina Turner sang:

We don't need another hero,
We don't need to know the way home
All we want is life beyond the Thunderdome

At LightCounting, we believe that life will exist for the optical industry, in one form of another.

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— James Kisner, Principal Analyst and Managing Director, Financial Services Business Development, LightCounting

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