Market and Technology Trends

Optical Computing 2024

Sep 2024

Optical computing could become a reality in the coming years enabled by silicon photonics and latest quantum optics advancement poised to reach more than US$3B in 2034.

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Report objectives:

The demands of artificial intelligence (AI) and machine learning (ML) require immense computational power and speed, which optical computing can provide, making it a promising area for research and investment.

Optics indeed offers numerous advantages: high-speed data processing, parallel processing, low power consumption, high bandwidth, reduced heat generation, and recent technological advances in silicon photonics and quantum optics. The success of silicon photonics in datacom, telecom, and optical I/O, along with advances in new high-performance materials such as TFLN and SiN, has sparked growing interest in using photons for processing. Furthermore, quantum computing is advancing rapidly, and photons are one of the promising options for qubits. Optical technologies are integral to the development of quantum computing, with quantum optics and photonic qubits being extensively researched for their potential to outperform traditional methods in quantum computations.

These factors collectively contribute to the renewed interest in optical computing, as both researchers and industry leaders aim to overcome the limitations of current electronic computing technologies and meet the ever-growing computational demands of the future.

This report aims to provide insights into the current status and future perspectives of optical computing, covering both analog/digital optics and quantum optics approaches.

Key Features

· 2024-2034 optical processors shipment, revenue

· 2024-2034 optical quantum computers revenue

· 2024-2029 SiN wafers shipment, revenues

· Optical processor, quantum computers players new PIC materials ecosystem, and supply chain analysis

· Optical processor, quantum computers, qubits, emerging materials, architecture technology trends for optical computing

When would be the business inflection point?

Optical computing is still in its very early stages. While some large companies have shifted their focus from optical computing to optical I/O, new optical computing startups continue to emerge, exploring diverse approaches.

Optical processors are primarily aimed at AI inference tasks. Additionally, optical quantum computers, based on qubits and other quantum effects, could be utilized for various applications such as simulation, optimization, and AI/machine learning. On the other hand, optical processors will be specifically geared towards AI inference.

We estimate that the first shipments of optical processors will begin in 2027/28. Initial shipments in 2027 will likely be for custom systems implementing parts of this technology, with most revenue coming from non-recurring engineering (NRE) services. By 2028, direct sales of general-purpose systems featuring optical processors will commence. From 2029 onward, early adopters, followed by OEMs and system integrators, will gradually incorporate optical processors. By 2034, we estimate the total number of optical processors to reach close to 1 million units, representing a multi-billions USD* market value.

We also forecast that shipments of photonic-based quantum computers will see significant growth starting in 2030, with companies like Quandela, QUIX, and Pasqal leading the charge. By 2034, this market is expected to be worth many 100s of USD* at the system level. In the coming years, the majority of revenue in this area will come from projects and NRE.

*exact data in the report

Many different technological options still in development

Optical computing is not a new idea, and there are many ways to implement optical gates, with photonic ICs and quantum optics being the most interesting approaches today. However, despite progress, practical optical logic gates still face significant challenges, as they need to meet multiple criteria such as cascadability between gates, scalability, and recovery from optical losses in order to compete with electronic gates. While current research often involves single gates or simple circuits, the development of large-scale optical computers remains in its early stages. Silicon photonics is an enabling technology for optical computing due to its scalability. One of the biggest issues with photonics has always been integration. As integrated optics is advancing rapidly with different materials approaches (SOI, SiN, TFLN, graphene, BTO, polymers), this could pave the way for PIC-based practical optical processors. Improvements in integration will also benefit the quantum optics community by enabling the development of quantum optical computers with a larger number of qubits in a compact form factor. There are currently different approaches to making an optical processor. It can be either analog or digital, using various optical media to handle the data, such as PICs, FSO, or fiber optics. For optical quantum computers based on qubits, we consider three different approaches. One uses photon qubits, while the other two use photonics to control non-photonic qubits, such as trapped ions and neutral/cold atoms. Additionally, some companies claim to be developing optical quantum computers that are not based on qubits, but instead use optical quantum effects and nonlinearity. New types of materials are also being developed for optical processors, although they are still at a very early stage, such as metasurfaces and SiC.

Still in its early stage but foundry offer is growing.

The success of optical computing requires a multidimensional approach, addressing integration challenges, manufacturing complexities, and infrastructure requirements. On the geopolitical side, specifically regarding the US/China ban, by the time Chinese domestic chip production catches up, the United States will need to have already moved on to tackling the next technological frontier in advanced computing, such as light-based computing or quantum computing.The optical quantum supply chain is still in its early stages, with high demand for advanced products requiring extensive R&D, leading to long lead times that hinder progress. Despite this, the supply chain is highly dynamic, with numerous players like GlobalFoundries, TSMC, Samsung, LioniX, and many others offering PIC foundry services. The sector continues to struggle with the "small volume problem," as the industry has yet to reach the stage of scaling and commercialization, with the current focus still on development and prototyping.

Over the past five years, nearly US$3.6 billion has been raised by companies involved in optical computing. With giants like Google, Meta, and OpenAI pushing AI capabilities to the limit, the race for faster and more efficient computing is intensifying.The latest funding round highlights investor confidence that photonics can provide the breakthroughs needed to sustain AI progress in the future. However, as with quantum computers in general, it is difficult to predict when the inflection point for optical computing will occur.Optical computing platforms are expected to see some adoption in academic and private research sectors within the next couple of years, but it remains uncertain whether they will achieve widespread applicability and adoption in the short to medium term.

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Optical Computing 2024

Optical computing could become a reality in the coming years enabled by silicon photonics and latest quantum optics advancement poised to reach more than US$3B in 2034.