Today, a lot of the communication that takes place on chips and between computers is accomplished by way of electrical signals carried by metal wires. If silicon photonics technology takes off, future chips might talk to each other with light carried over optical fibers. IBM recently announced that it's successfully designed and tested a "fully integrated wavelength multiplexed silicon photonics chip" for the first time.
That's a lot of words to unpack, so I'll try my best to explain. "Fully integrated" means that each chip features optical components and "structures for fiber packaging" directly alongside electrical circuits, by way of a proprietary process IBM is calling "CMOS Integrated Nano-Photonics Technology." The company says that these chips are made using standard silicon fabrication processes at a sub-100nm scale, making them ready for commercial use.
Each silicon photonics transceiver can multiplex four wavelengths of light for transfer rates of up to 100Gbps over single-mode fiber. The company's reference transceiver can communicate at that speed over distances up to two kilometers. Current optical interconnects using multi-mode fiber can't transmit data nearly as quickly over the same distance, topping out at 10Gbps for distances under 550m, according to Wikipedia.
IBM anticipates that the greater bandwidth and transmission distances offered by its silicon photonics tech will alleviate the congestion of datacenter interconnects in applications like real-time data analytics (or "Big Data," if you prefer), and the fully integrated design of these transceivers is said to make them cost-effective, too.
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