The promising silicon photonics industry: China is getting started

Today, the main market for silicon photonics is optical communications. Silicon photonics accounts for more than 20% of the datacom optical transceiver market in value terms. We predict that this proportion will grow to about 30% by 2027. Silicon photonics is increasingly used for 500 m distance DR standard connections, but it is also increasingly used for coherent technologies in data communications applications. Demand for 400ZR standard technology is also increasing. We estimate that the chip-level market will be worth US$152 million in 2021. In 2027, the market will approach $1 billion.

This growth will be driven by many markets due to the increasing maturity of the platform. Medical applications are starting to enter the market, with many startups using silicon integrated optics as a manufacturing platform. Consumer health developments continue, with Rockley announcing that its VitalSpex TM biosensing platform will ship in 2022/23. This will pave the way for future integration of silicon photonics-based biosensors into wearable devices from big brands like Apple or Huawei.

Optical interconnects using silicon photonics will enable distributed data centers to deliver more power to high-performance computing (HPC) and data communications. AyarLabs is taking this approach, with first shipments planned for 2022. Applications will include HPC and data centers.

Photonic computing, which allows analog artificial intelligence (AI) calculations to be performed much faster than today's digital AI, is in development and will be on the market soon.

In the automotive sector, more and more manufacturers are integrating light detection and ranging (LiDAR) into their products. Silicon photonics will enable compact and affordable frequency-modulated continuous wave (FMCW) lidars and integrated gyroscopes.

The growth of the co-packaged optics (CPO) market remains an open question, but regardless, such products will coexist with pluggable optics. Due to its integration capabilities, silicon photonics is the right technology to become the missing link between CPO and pluggable.

The silicon photonics industry landscape is active. The potential of silicon photonics applications has led to the creation of various companies over the past three years. Several players are taking advantage of the opportunities offered by silicon photonics to enter the optical transceiver market. Others are using the opportunity to find new applications such as medical, sensors, interconnect and computing.

Intel remains the market leader with 58% market share, followed by Cisco with 29% and smaller players such as Marvell/Inphi, Sicoya and others. Tower's acquisition by Intel is part of the latter's strategy to bolster its foundry activities and potentially become a major silicon photonics foundry.

China continues to be very active in the development of silicon photonics, with many players involved. Although the industry is still in its infancy in China, partnerships and joint ventures are being formed, and R&D activities are important.

Examples of collaborations between Chinese companies include the previous Rockley/Hengtong partnership and current collaborations between Sicoya and Broadex, Skorpios, Luxsharetec and Broadex, as well as Huawei and ZTE’s collaborations with their external suppliers, which consolidate the focus on silicon Access to photonic technologies.

China is currently building a complete silicon photonics industry, including silicon-on-insulator (SOI) suppliers, start-ups and large companies.

Historically, integrated photonics was developed on SOI platforms. The goal is to benefit from the wafer-level manufacturing technology of the CMOS industry and apply it to photonic chips. But SOI wafers are expensive, and silicon is not necessarily the best material for all different photonic functions.

InP integration has been one of Intel's biggest challenges from the beginning. The successful development of InP chiplet integration on SOI is key to Intel's success in the silicon photonics business.

Today, as data rates increase, high-speed modulation on silicon is becoming a bottleneck. Therefore, to overcome current limitations, there have been various developments in new materials, including lithium niobate (LNO) films, InP, barium titanate (BTO), polymers, and plasmonic materials. For example, Arista integrated thin-film LNO into the modulator in its 800G transceiver prototype at the OFC 2022 conference. In addition to LNO, Riber is developing BTO and Lightwave Logic is developing polymers.

As integrated optics moves toward increased functionality, the definition of silicon photonics will expand to include the integration of other materials. However, for cost-effectiveness, a CMOS manufacturing environment is still necessary.

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