Datacenters: how silicon photonics, CPO, DPU and chiplets will reshape the entire industry before 2030

November 01, 2022

Datacenters must support the incredible growth of data generated by our society. Social networking, business meetings, video streaming in ultra-high definition (UHD), e-commerce, and gaming applications have created new demand for mobile bandwidth requirements and will continue to drive growth. As such, datacenters must show resilience, efficiency, low latency and comply with governmental restrictions. To this extent, decentralization and disaggregation of datacenters have been on their way for many years, but today are even more prominent. There are many technologies empowering datacenters. However, a few of them drive almost all the innovation, namely optical transceivers, silicon photonics, Co-Packaged Optics (CPO), Data Processing Units (DPUs) and advanced packaging with chiplet approaches. Thanks to our report collection, Yole can offer you the best available analysis of this critical industry and centerpiece of our society and measure the impact on the global semiconductor industry.

Let’s review those technologies one by one.

Today’s pluggable transceiver form factors and their performance are evolving in incremental steps, from 100G to 400G to 800G and even higher data rates. However, they will be limited in their ability to support more than that in terms of required electrical and optical densities, thermal aspects, and power consumption in the longer term. Today, market evolution and competition in this field are intense between players like Innolight, II-VI or HiSense (and many more). This optical transceiver evolution is deeply linked with the second technology: silicon photonics (SiPh). SiPh is the key platform mastered by players like Intel, Cisco, Acacia, Sicoya and AOI, to name a few, to develop future transceivers and achieve the performance needed to support future use and displace electrical connections. SiPh is integrated into 25-30% of current transceivers, and the proportion is still growing. Alongside these two technologies, CPO is a new approach that brings the optics and the switch Application Specific Integrated Circuit (ASIC) closer together. This aims to overcome the challenges facing pluggable transceivers. This technology will rely heavily on SiPh. With advanced packaging technologies, especially high-performance packaging, CPO will increase bandwidth and shrink transceiver size. Yet, with highly integrated optics and silicon chips, manufacturers will need new engineering capabilities and foundries. Today, only a few players, like Broadcom, Intel, Ranovus, Nvidia, Ayar Labs and some others, have internal capabilities to bring proprietary solutions to the market. The fourth technology is processing and computing capability. Datacenters must handle many different types of data, and DPUs can increase their efficiency. They can pool heterogeneous computing devices such as CPUs, GPUs, FPGAs and accelerators and storage resources, specifically SSDs, distributed across servers together directly to maximize utilization and, in doing so, reduce Total Cost of Ownership (TCO). DPUs enable disaggregation and pooling of computing and resources at scale. With players like Alibaba, nVidia which has acquired Mellanox, Intel, AMD through its acquisition of Pensando, the DPU trend is a hot topic for all the big players.

Last, but not least, the evolving device packaging within datacenters is also another key technology, with the emergence of heterogeneous integration through the chiplet approach. Chiplets introduce modular design into semiconductor fabrication and packaging. Think of this innovation as turning the silicon of a chip conceptually into the “motherboard” of a server. Such evolution is necessary to achieve the next three orders-of-magnitude performance jump beyond exascale that datacenters need.

Thanks to best-in-class analysis around these technologies, the Yole group can offer you the most complete deep dive into how photonics and datacenters will evolve for the next ten years. Add our physical teardowns analysis of the most innovative modules of this industry, you also have access to the real costs and a direct view into this evolution and how the industry is innovating in these technologies.